Transforming Corporate Banking with Open Banking and Open APIs – Some Examples

Transforming Corporate Banking with Open Banking and Open APIs – Some Examples

Traditionally, corporate banks were always the last to get technology toys after retail or investment banks, but this is now changing in the era of fintechs, challengers, and open banking and application programming interfaces (APIs). European and Asian banks are now seeing new ways to share data and develop opportunities, connectivity, and ecosystem-based business models in the fight to retain customers and remain relevant. This report looks at some examples of the emerging trend of open API, its drivers from regulations like PSD2 to technology and client demands, plus the threats and opportunities it offers in the corporate banking arena. It includes product and service delivery examples. "Globally, banks had been concentrating on the retail-focused approach toward open banking for quite a few years, with a prime focus on improving operational efficiency and expanding reach to the retail customer," says Anuj Agrawal, senior research manager, IDC Financial Insights Asia/Pacific. "However, in the next two years, banks will expand their horizon and move to a wider corporate banking-based API plan, offering access to transaction banking processes such as cash management, liquidity management, and treasury.""Corporate clients expect banks to offer better pricing and services, as both can be examined more easily in the emerging open API–enabled era," says Neil Ainger, IDC's research manager for Worldwide Corporate Banking. "Innovation, customer, and transaction data sharing should lead to useful new data aggregation and interrogation tools and new services and products. APIs aren't new, but the use of external open APIs to enable third parties to access data and develop new services is. This means challenger or incumbent banks can gather fintech start-ups into an ecosystem or platform, or corporate clients can go to them directly. Competition will increase and business will be won in the services layer, not at the infrastructure layer or via proprietary closed data pools, as was previously the case. Banks that don't respond could lose out to newcomers. Open APIs are a threat or opportunity, depending where corporate banks are on the maturity scale. They can facilitate faster payments, cash management, and co-creation. End uses span risk, credit, and co-lending so far but others are also explored in this report."

Please Note: Extended description available upon request.

Executive Snapshot
Situation Overview
Regional Approaches in Open API
Corporate Bank Challenges & Opportunities
Corporate Banking: Open API Drivers
Open APIs: Definition
Open Banking: U.K./EU Regulators and the Asian Approach
IATA: Example of a Corporate API-Enabled End Use
Adoption Drivers
Faster Payments
Request-to-Pay Functionality
Co-Creation: IoT and A Blockchain-Driven Example of Delivering Corporate Value
New Revenue Streams Via Platforms
The Role of Fintechs
10 Early Examples of Open Banking and API Innovations in Corporate Banking
Cross-Border Payments and Related API Exchange
SWIFT, Ripple, and R3
IBM Blockchain World Wire
JPMorgan INN and Visa Connect
Trade Finance
India TradeConnect
Syndicated Lending
Value Driver Framework for Corporate Banking Open APIs
Most Common Areas of Implementation (So Far)
Advice for the Technology Buyer
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