What are open APIs?
An open API- generally referred to as public API- is an application program interface, providing a developer with programmatic access to proprietary applications. APIs are software intermediary allowing the application programs to interact with one another and share data. It is generally an implementation of Representational State transfer (REST) that exposes the functionality of specific software while protecting the rest of application. Open APIs are published and shared freely on the internet.
APIs – the next evolution in mobile money innovation
There are millions of people using mobile money to send money or make payments but they hardly bother to think how their mobile device connects to the network, then to the financial service provider and then to their cash recipient. But, for the software developers, the data transmission pipeline is crucial – in case the information does not smoothly flow from point A to point B, then the mobile users lose out their access to basic financial services. This is the reason behind the excitement about the opportunities created by open APIs. They have the potential to offer a chance to the developers worldwide to share their respective mobile financial service ideas, cost-effectively and quickly connect to the pipeline and come out with effective mobile money services on a massive scale.
The potential for an open API to drive innovation in the mobile payments space exceeds the expectations, but the concept being new to the sector, needs the basics to be right before the launch of API platforms on a large scale.
From the developers’ perspective, a number of factors are important for the success of any open API ecosystem. Below we have provided some from shortlist:
Open APIs should be well-defined, well-documented and stable– They must have clear guidelines for the developers and they should not change without prior warning. Democratizing the mobile money sector to ensure that the new developers can launch their micro-payment platforms or remittance apps, it needs to be ensured that the instructions for building the pipelines between the services and mobile networks are easy to follow and consistent.
Open API access processes should be clear and widely available online– Efficient mobile money services are result of an easy linkage of point-of-sale payment service with the mobile money platform. The easy availability of instructions always helps the applications making it to the market. The monolithic appearance of the mobile networks and absence of a contact point discourages many developers to launch their service on a smaller scale, limiting their impact potential.
Tracking usage and user data should be easy with open APIs– Today’s time has got data analytics and data sharing as a useful feature. The developers want good feedback loops in order to understand the number of users accessing their API-linked services and their usage patterns for constantly improving the services.
Now-a-days, when open APIs have become a rule to success, the innovation rate among the developers will be robust. Those having promising mobile service strategy will face lesser go-to-market barriers. And, for the financial service users, the option range will be far more diverse, personalized and locally relevant- leading to greater level of financial inclusion.