If you’ve never seen it, do yourself a favour and check out Steve Jobs’s Stanford 2005 commencement speech. In it, one of the most successful business people of all time listed key events and decisions that he made early on—good and bad—that ended up shaping his career. Those included dropping out of college, getting fired, and taking a calligraphy class that fired up a passion for beautiful typography - a hallmark of the first Mac computer he designed.

What Jobs was really talking about here is a concept we could all make a lot more use of in business and life: serendipity—the ‘occurrence and development of events by chance in a happy or beneficial way’. You don’t always have to start out with a master plan to succeed. And sometimes, you can still get to your destination, even if you start pretty late in the game.

Take enterprises’ use of the humble API (application programming interface). Most financial services companies use APIs with good reason. They give developers what they’ve lacked for so long: easy reusability, and the chance to assemble robust business systems with proven bits of code that work and will be maintained by reliable third parties. According to the State of APIs 2022 Report, 80% of surveyed developers from the financial services industry stated that they work on internal APIs, 59% work on partner-facing APIs and 49% on third party APIs. It’s estimated that larger organisations now use more than 300 different APIs. In the mentioned survey, 14% of developers reported to use more than 250 internal APIs alone.

That makes sense, as APIs are particularly useful at accelerating digital transformation, a high priority in financial services. Even before that, APIs were proving their worth to the bank CIO. What else, after all, are credit card authorisation and SWIFT transaction processes but chained series of transactions and data exchanges via accepted interfaces across multiple parties? 

However, in our enthusiasm for APIs, we have allowed them to proliferate here, there and everywhere - often without a master plan for maximising their usage and potential.

Have we ended up with a hot API mess?

There are many drivers of change in financial services including the push to microservices  and cloud-based architectures - not only by the digital challengers, but traditional players as well. Fintech never would have progressed at the breakneck pace that has this past decade without industry standards and the APIs to implement them and get services up and running. Key among these is the move to Open Banking, where all players have been required to open up their interfaces to third-parties to access information. 

But to be candid—it’s getting messy. There are so many banks, not only those affected by PSD2, that need to be interoperable to make open banking or new digital services work. This has given rise to a new type of business, the API aggregator, that combines APIs from multiple providers to build new products and services. Whatever your views are on this, it’s created a lot of work securing connections around all these exposed APIs. And there is a need for clarity; does the line of business manager mean internal or external APIs when they ask for change? 

With the benefit of a time machine, you could go back five years and create the right architecture to support all this. But failing that, serendipity can work its magic. With a few simple steps, and even without an overall API ‘master plan,’ players in the financial sector can still gain huge benefits from APIs. 

How do I know this is all possible? Because financial services IT leaders like Shania Fu, AVP for API Platforms at Sun Life, are showing the industry what is possible. In her case, by quickly setting up a one-stop shop—a marketplace—to corral together all her APIs.

Sun Life internal developers now have access to over 200 APIs they can just grab and work with any time they like (or need). “Sun Life wants to become the best digital insurance and asset manager in the world,” explained Fu, “so we want to advance our digital agenda.” With her new marketplace that’s absolutely happening—and it means partners can also be encouraged to work with Sun Life APIs in a very easy way, which is another way to cement her organisation’s digital enterprise transformation plan’s success.

‘Your teams should be thinking of APIs as early as possible in the software development lifecycle’

Fu and her team’s example encourages others to start making the most of API abundance with a couple of simple steps to make them more manageable. The first step is to start cataloguing all your internal APIs. This makes sense, as the internal APIs your developers are using to create new products and integrations should be the right ones on the API market. Encouraging API best practice here is a perfect way to build the team’s overall confidence and overall API skill set. 

Next, save yourself considerable time by sourcing a good API platform. This gives you total visibility into what’s happening and provides a central place for developers to find and use APIs. Look for systems with tools like search, tagging and filtering, as well as testing and governance.

Then, look to create some science around the bank’s API creation process. What do I mean by that? Well, your teams should be made super-aware of APIs and thinking of them as early as possible in the software development lifecycle. 

Last but not least, ask yourself if you are always leveraging your APIs to innovate and offer new products and services for the bank’s partners and customers. You can also monetise your own APIs. API monetisation is a business model where organisations sell access to their own APIs, for example for gathering their data or performing actions on their platform. According to the State of APIs Report, the financial services industry particularly benefits from API monetisation. Fifty-two per cent of respondents from this industry said they monetise their APIs already. This is 16 percent more than in the previous year and nine percentage points above the general average.  

By approaching APIs as powerful tools, mature enough to productise and monetise, and you won’t go wrong. It’s fine to have all these APIs; just start automating their exploitation.

Think of it as your version of Steve’s calligraphy class; a serendipitous end to what started with no ‘master plan’… but still resulted in huge gains for his company.