ORLANDO—Time for credit unions to gain a strong understanding of application program interfaces (APIs), insists one analyst who said the increasing speed at which devices and programs are connecting is making the tech protocol much more mainstream.
An API is a set of routines, protocols, and tools for building software applications. The API specifies how software components should interact, which is key to allowing devices and applications to talk to each other. There are many different types of APIs for operating systems, applications or websites. For example, an API is what allows text from Windows to be pasted into another application.
CSCU Chief Technology Officer Tom Davis pointed out that Capital One’s mobile banking app has an API configured to interface with the Amazon Echo API. The Amazon Echo is a tall cylinder—a wireless speaker and voice command device with a seven-piece microphone array. The device responds to the name "Alexa," as evidenced in the television commercial with Alec Baldwin. The Echo is capable of voice interaction, performing digital tasks, music playback, providing weather, traffic and other real-time information and more. It can also control several smart devices.
Ask Alexa
“You can now pay your Capital One bill by telling Alexa to do it,” said Davis during CSCU’s 2016 Solutions annual conference here. “The Echo API goes out to the Capital One API and then sends data back to Alexa. You can just say, for example, ‘Tell me how much money I have left to spend on my credit card.’ Or, ‘Tell me when my next payment is due.’ Understand APIs, because they are coming, and they are coming fast. This is all about the Internet of Things, how things are all getting connected.”
Davis said there are even APIs out now that work together to have the lights in a home flicker when a someone posts to a person’s Facebook account.
“The Jetsons age is here,” he said.
Tom Davis
Davis noted that core systems today are being pushed to be open source, enabling a hardware or software system to integrate with consumer data. “You are going to need seamless interdependence between third-party providers and systems inside the credit union.”
Interconnectedness Takes Time
Davis acknowledged that it will take time for banks and credit unions to adjust to the new interconnectedness, pointing out that it took ten years for mag stripe plastic to really gain traction.
Davis also reminded that forecasts are calling for digital financial transactions to far surpass branch transactions in the not-too-distant future.
“The vision members have of your credit union is changing as they expect to get more and more through mobile means,” he said. “An increasing number of your members would rather deal with you through your mobile app than come into the branch.”