by: Grow VC Group
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Everyone talks about the API economy and how it also comes to the finance sector. But what does it really mean for finance companies? Banks, insurance companies and other finances services are seriously struggling with their legacy IT infrastructure and it presents a clear bottleneck to roll out new offerings without huge costs. Now with cloud based back offices and open APIs, anyone can build finance and banking services in a few days. Banks must adapt to this new model in order to be able to survive, otherwise they commit to a slow and painful suicide weighed down by their old IT solutions and processes.

Technically speaking, an Application Programming Interface – “API” is nothing more than a set of routines, method and tools for how software components should interact and be accessed, e.g. be the user interface (“UI”). You can build applications and integrate third party services into applications by using an API method. However, the concept of the API economy is much broader and centers around the idea of how to build new concepts efficiently.

There are various parts of a new technical application that make sense to house internally. Equally, there are many parts of applications that do not need to be re-invented or re-done. The latter you would typically source from specialist vendors and integrated. Traditionally, integration could be a costly, complicated and risky undertaking where countless of hours would be spent on lining up data models, integrating process flows and synchronizing software frameworks. There are also countless of examples of flawed or failed integrations, where the simplicity of a ‘one stop shop’ concept ends up serving no one.

Building on top of an API gives you the benefit of leveraging many components, while retaining the control of your end user contact point and user experience. The Crowd Valley Digital Back Office and its API is a good example of how the sum of the parts are more valuable than the parts themselves. By being able to interact with only one software stack, the client side application can draw on financial back office functions such as payments, custodian solutions, clearing, to compliance functions such as KYC/AML checks, bad actor checks to the complexities of transaction handling, audit logs, secondary market work flows etc.

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Grow VC Group The Grow VC Group is the world leading, global pioneer of securities crowd funding, peer to peer marketplaces, new investment models and global business development. Established in 2009, the Group has developed new investment models on six continents and continues to innovate the global market.

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This entry was posted on Tuesday, February 16th, 2016 at 1:00 pm and is filed under Business Updates. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.