Open Banking PTBR

3 axway.com Each bank implementing APIs is unique In Europe, all banks that do local business are required under new European regulations to introduce payment transactions and account information processing as part of the Second Payments Services Directive (known as PSD2). In addition, globally, banks are looking to APIs to gain a strategic advantage with the ability to create new products and services faster, onboard partners and work collaboratively in new markets, and reduce inefficiencies and duplication. While these are common drivers for all banks, most banks in Europe have their own contexts and histories. So when they are implementing an API strategy across the organization, they must be able to adapt technologies and business processes to tap into legacy systems, align with internal cultures, and maintain the unique characteristics that have empowered their market leadership for so long. For Norwegian-based SpareBank1, APIs had to be introduced while paying heed to three of their longer term, historical characteristics: their organizational structure, the wider Norwegian business environment, and their own business models. Organizationally, SpareBank1 is not just one bank: it is made up of a group of separate entities that have a specific industry focus. "SpareBank1 is actually 14 banks," explains Baard Slaattelid, EVP/Director of Banking as a Service at SpareBank1. "All of our banks are full service, but each has a slightly different core focus or competence based on their customer needs." When implementing a whole-of-organization API strategy, SpareBank1 had to resolve how best to introduce central API governance and provide a best practices team to support all entities, while not being overly prescriptive in defining how any line of business or company must act. Norway's banking landscape also brought its own challenges. "Unlike other European jurisdictions, Norway already had many of the elements PSD2 seeks to introduce," explained Slaattelid. "We already have common banking technology: Norway created a common payment scheme and we have common digital IDs (called BankID) that every Norwegian bank customer has and that can be used across bank borders. All Norwegian banks already cooperate on common mobile payment solutions," said Slaattelid. While other banks may have been co-opting their product management departments to understand the business value of APIs, because of the history of common technologies in Norway, SpareBank1's main PSD2 API focus was purely technical. "Because of this technical context, the business side was involved, but didn't tend to be the initial driving force." A final context that impacts the way SpareBank1 can create and publish APIs is their current business model. For starters, in Norway, corporate and personal banking tend to use different payments systems, but PSD2 stipulates that banks must have only one. "That's a problem for us," said Slaattelid.

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