API QuickStart Guide for Community Banks

Community banks who want to make faster and smarter lending decisions, drive efficiency in their back-office processes, and improve customer satisfaction are implementing digital transformation by enabling API platforms.

With APIs, banks can modernize in a simpler way as opposed to the hefty customization requirements involved in upgrading legacy core banking systems.

This QuickStart guide can serve as helpful direction as you navigate the process of digital transformation within your bank. With good preparation, you can avoid costly and time-consuming pitfalls and maximize your benefits.

We’ll cover strategic planning, development and implementation, management tools, and governance.

Strategic Planning:

Your API strategy is your blueprint for transforming your current business into a nimbler, more powerful environment. But what does this really mean, and what do you need to get started?

Core10 has worked through these same issues with dozens of financial services organizations and developed these five keys to creating a successful API strategy. As you prepare your own strategy, consider these five essentials to help ensure you are leaving no stone unturned in the process.

Strategy sessions must include:

• Input from internal and external stakeholders – think employees, customers, and vendors
• Detailed target audience profile – know who they are and what problems they have
• Desired business outcomes that are specific and measurable
• Detailed prototypes, models or examples of what you want to achieve
• Executive-level support and endorsement

Development and integration:

Once your team is aligned on the best API strategy for your community bank, development and implementation can begin.

Since most banks are not staffed for full-fledged API development or integration, you'll want to work with a software development partner who specializes in financial technology. Your development partner will design and develop your API based on your defined desired outcomes.

Not all API developers are alike. Look for a developer partner who has:

• A positive reputation among other community banks
• A track record of successful fintech experience
• Transparent processes and organization
• Integration expertise and resources

Many organizations think API integration is one-size-fits-all. That thinking can lead to costly mistakes.

Integration must be scoped properly, planned, and executed well. Make sure you're working with a partner who will support your needs thoroughly yet efficiently. A good integration partner will ask scoping questions that include:

• How many people will input data into the system?
• How many will need reporting generated from the system?
• How many “power users” will you have?
• How much data will need to be migrated into the new system?
• How much functionality will be available for the team?
• Are users centrally located or remote?
• How complex is the new system?
• How large is the organization?

Management tools:

Once your API strategy has been realized, the work does not stop. Imagine a common scenario in which one day, the integration stops working. Without management tools, you won't have the visibility you need to restore service quickly.

You must plan to manage and govern APIs appropriately. Equip your team with API-focused tools that include application performance, lifecycle management, and capacity planning. Ideally, you'll want these tools accessible under a single platform.

In addition to your internal users, you’ll want to know:

• Who’s accessing paid services?
• How much do these services cost?
• Which users can access data collected by the APIs your organization uses?

Governance:

Good API governance not only ensures your bank is compliant with governmental regulations and organizational standards, it sets expectations within your organization for how APIs will be developed and used. This can save your bank time and money in the long term.

If Governance is not already part of your organization, you'll want to establish a person or team to be responsible for it.

Prepare for your future:

A well-designed, strategic API can take your bank's current infrastructure investment and make it nimbler. It’s a type of future-proofing that sets up your organization to grow accounts faster, reach customers where they are, and empower your human resources to create new opportunities.

When you’re ready for a partner who understands both the needs of the banking industry and API development and implementation, Core 10 is ready for you.