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api3.org
The API Economy in
Financial Services
api3.org
Presenter
Giovanni Lesna
Enterprise Lead &
Partnerships
gio@api3.org
CMC
MBA Digital Business (UB)
Masters in Blockchain (UB) ; BCom Hons (UNISA)
LinkedIn: Giovanni Lesna
api3.org | 3
Agenda
1. Hype, Benefits and Risks of the API Economy
2. Open Financial Services
• Open Finance
• Open Banking
• Open Insurance
• Healthcare & APIs
3. OBP Project & API3 – Connectors of API Economy
4. Q&A (Please post Questions in the chat)
10 Min
5 Min
10 Min
Hype in the API Economy?
api3.org | 4
Why the Hype? Gartner Hype Cycle – Slope of enlightenment
1. More instances of how the technology can benefit the
enterprise start to crystallize and become more widely
understood
2. Salesforce.com shelled out $6.5 billion for MuleSoft.
3. Visa agreed to pay $5.3 billion for Plaid .
4. Google acquiring Apigee for $625 million
5. Kong raised $100 million at a $1.4 billion valuation
6. Just look at the Uber app.
7. McDonalds + UberEats
What is the API Economy?
api3.org | 5
APIs enable companies ease in building products and
services that would take too long to build – “Plug-and-
Play” the basis of the tech
1. APIs are customer facing, customizable software
interfaces that enable once separate software
components to effectively communicate by
overcoming the inherent incompatibilities created by
differing software platforms.
2. Think… Lego blocks
3. Multitude of Connected Microservices > creating an
Application
Source:APJ Cloud 100 (2015)
Remain AGILE
api3.org | 6
Source:Anatas (2021)
1. Plan/Design >
Engage/Consume >
Run/Manage/Monitor >
Build/Integrate
FASTER!
Benefits of using APIs
api3.org | 7
Benefits & drivers
1. COVID-19 and Digital Transformation
2. Ecosystem economics & economies of scope
3. Improved customer experience
4. Continuous innovation
5. Increased efficiency: focus on making their digital
assets readily accessible. Easier for all participants to
develop unique products, services and functionality
quickly and with less cost.
6. Fast delivery: having open, modern industry-accepted
development tools = faster to build and bring products
to market and new opportunities for revenue more
quickly.
Risks
1. Data breach: Data misuse and abuse by criminals
wishing to take advantage of weak API security
2. Data hostage: Power held by “aggregator” firms. Once
they aggregate a critical mass of global digital users,
monopoly position to dictate the terms of data access
and API usage.
Open Finance
api3.org | 8
Open banking (OB) and insurance is a subset of open
finance
1. An extension of OB data-sharing principles to
enable third party providers to access customers'
data across a broader range of financial sectors
and products, including savings and investments
2. Decentralized Finance (DeFi & Web3.0)
3. Centralized Finance (CeFi & Web 2.0)
4. Cross sector & Ecosystem focus
Open Banking
api3.org | 9
Open banking mandates or encourages financial
institutions to allow authorised third parties access:
1. To individual and business customer data
(e.g. account information).
2. To financial services (such as payment initiation).
3. Following customer consent.
4. In a machine-readable format (API).
5. Established by regulators or from market demand.
6. PSD2 (Second Payment Services Directive)
7. GDPR (General Data Protection Regulation) &
other Global Privacy Regulations
Open Insurance
api3.org | 10
The Open Insurance movement is growing but not mandate
as of yet. This would follow in the success of open banking
footsteps:
1. Allow consumers to access and share their data with
other insurers or third parties, in a safe, agile, accurate
and convenient way
2. Interoperability & Integration
3. Placing the customer at the heart of the business and
processes
4. Creating new use-cases that would not be possible.
Parametric insurance, integration with 3rd party service
providers e.g. medical practitioners, auto repairs).
5. Insurance-as-a-service (IaaS) – micro-insurance
6. Some equivalent of PSD2 & GDPR
Some nations pursuing this through public consultations
1. SUSEP (Brazil) , Superintendence of Private
Insurance- Just published guidelines & standards
2. EIOPA (EU) , European Insurance and
Occupational Pension Authority (EIOPA) /
European Commission’s Digital Finance Strategy
3. Open Insurance Initiative (Italy), Italy Working
group – API Playground
Willis Towers Watson estimates 67% of insurers will
modify business models by 2025.
1. AIA’s partnership with WeDoctor (110 million users)
– win-win- Medical Insurance
2. ‘InsureMyTesla’ - uunderwritten by AXA to simplify
car insurance
3. Ping An + Samsung with Samsung’s digital health
capabilities, such as heart rate sensing smart
watches.
4. Nationwide & RiskStream exploring interesting use-
Healthcare and APIs
api3.org | 11
Enable better access to health information for patients,
improve interoperability and unleash innovation:
1. Department of Health and Human Services (HHS) put
together rules that give healthcare consumers access to
their personal data.
2. The CMS (Centers for Medicare & Medicaid Services )
rule targeting U.S. healthcare organizations.
3. Improve Interoperability & Integration at the core digital
healthcare system (FHIR R4 standards).
4. Health insurance companies expose clinical and claims
data of patients as FHIR compliant APIs to the patients
themselves, or to third-party systems that the patient
selects.
5. HIPAA Compliance & GDPR.
Industry APIs
1. EHR (Electronic Health Record) APIs,
2. Consolidated APIs to access patient data,
3. Clinical data management and analytics APIs,
4. Public health content APIs,
5. Drug data and drug interaction checking APIs,
6. Symptom checker APIs. and
7. Telehealth APIs.
Implications
1. Patient has portable health data,
2. Provide data for custom gene or medical therapy,
3. Patients decide and are remunerated for their
health data,
4. E.g. users connect iWatch data for lower medical
insurance premiums (Discovery Insure).
api3.org | 12
▵ Open Bank Project is the leading open source Open
Banking solution.
▵ Standard Catalogue of 400+ APIs covering several
standards.
▵ Vibrant global developer and partner community of
11k+
▵ Berlin and UK based consulting and software engineering
business.
▵ Started Open Bank Project in 2010.
▵ Inspired UK Open Banking, Berlin Group, Australian CDR,
& recently Mexico Open Finance.
OBP Customers
api3.org | 13
OBP works with many of the world’s
largest financial institutions
60+ FI Customers 11K+ Developers Regulators 20+ Partners ~
api3.org | 14
▵ Since 2018, API3 predecessor worked on connecting APIs
to Web 3.0. Limitations drove us to innovate.
▵ API3 is DAO-governed.
▵ Integrations to multiple EVM compatible chains, inc.
Ethereum, Polygon, Fantom, Harmony, Plasm,
TomoChain, Conflux.
▵ Investors inc. Digital Currency Group, Placeholder,
Pantera, CoinFund, Accomplice, Hashed.
▵ API3 + OBP enter into a 10 year partnership to bridge OB
APIs to Web 3.0.
API3 Investors
API3 Partners
API3 Overview
api3.org | 15
API3’s mission is to make APIs fully
compatible to Web 3.0
▵ APIs are the glue to the internet. Salesforce, Ebay, FB,
Google, Expedia, Uber, Airbnb are powered by APIs.
▵ Web 3.0 must be able to access the kind of services that Web
APIs offer in order to interact with the real world.
▵ Connecting APIs directly to Web 3.0 will create new dAPPs
and digital agreements, expanding the markets for
decentralized networks.
The API Connectivity Problem
▵ Due to the way blockchains internal mechanisms achieve
consensus, blockchain applications cannot natively connect to
external data.
▵ Current connection solutions depend on middlemen
○ API providers require expert management to connect
to Web 3.0, which is not scalable.
○ Many API providers hire third party companies that
deliver and re-sell the data for them.
■ API providers risk GDPR breaches, spillage,
and unauthorized data resell.
api3.org | 16
api3.org | 17
The API Connectivity Problem
▵ Previous solutions focus: how can blockchains as
technology connect to APIs.
▵ API3 focus: how can APIs as a technology connect to
blockchains.
▵ Data sharing happens through APIs. All APIs have
adapters and standards to share such data.
▵ No uniform standard API adapter exists for APIs
connecting Web 2.0 data to Web 3.0.
Airnode — An API Gateway
to Web 3.0
api3.org | 18
▵ Airnode is a simple to use, open source API gateway that
allows APIs to directly connect to Web 3.0, without active
management or the use of third parties.
○ Quick set up (minutes)
○ Set-and-forget (maintenance free)
○ Free for API providers to deploy
▵ Airnode allows the API provider to retain full control of their
data, allowing them to be fully GDPR compliant when
transacting in Web 3.0 environments.
▵ API3 & OBP will provide 400 OB APIs to Web 3.0.
api3.org | 19
Tap into external APIs from other financial services providers to use financial data and
create innovative applications and new business models.
Insurance
dApps
Pension Funds
Bank account information Payment
Initiation
Open Finance Data For Web 3.0
Open Banking APIs Enable:
○ Read Account Information.
○ Payment Initiation.
○ Banking-as-a-Service.
○ Banking-as-a-Platform.
○ Account Aggregation - Credit Scoring
○ Insurance, stocks, and pensions
○ DeFI<>TradFi
api3.org | 20
Web 3.0 Services
Platforms
API Layer
Open Finance Data
Core Banking
Airnode Connected with Open Bank Project APIs
Accounts Payments KYC/AML Branches/Products Metadata API Metrics & Docs
Web 3.0 Connections
Self-sovereign
Identities
CBDCs Wallet
aggregation
DeFi Parametric
Insurance
Blockchain
Banking Services
Partnership For End-
to-End Open-Source,
Open Banking on Web
3.0
api3.org | 21
Open Insurance being
explored for Web 3.0
and beyond
api3.org
Contact Giovanni Lesna
gio@api3.org
api3.org
f
Questions

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apidays LIVE New York 2021 - API Economy in Financial Services by Giovanni Lesna, API3

  • 1. api3.org The API Economy in Financial Services
  • 2. api3.org Presenter Giovanni Lesna Enterprise Lead & Partnerships gio@api3.org CMC MBA Digital Business (UB) Masters in Blockchain (UB) ; BCom Hons (UNISA) LinkedIn: Giovanni Lesna
  • 3. api3.org | 3 Agenda 1. Hype, Benefits and Risks of the API Economy 2. Open Financial Services • Open Finance • Open Banking • Open Insurance • Healthcare & APIs 3. OBP Project & API3 – Connectors of API Economy 4. Q&A (Please post Questions in the chat) 10 Min 5 Min 10 Min
  • 4. Hype in the API Economy? api3.org | 4 Why the Hype? Gartner Hype Cycle – Slope of enlightenment 1. More instances of how the technology can benefit the enterprise start to crystallize and become more widely understood 2. Salesforce.com shelled out $6.5 billion for MuleSoft. 3. Visa agreed to pay $5.3 billion for Plaid . 4. Google acquiring Apigee for $625 million 5. Kong raised $100 million at a $1.4 billion valuation 6. Just look at the Uber app. 7. McDonalds + UberEats
  • 5. What is the API Economy? api3.org | 5 APIs enable companies ease in building products and services that would take too long to build – “Plug-and- Play” the basis of the tech 1. APIs are customer facing, customizable software interfaces that enable once separate software components to effectively communicate by overcoming the inherent incompatibilities created by differing software platforms. 2. Think… Lego blocks 3. Multitude of Connected Microservices > creating an Application Source:APJ Cloud 100 (2015)
  • 6. Remain AGILE api3.org | 6 Source:Anatas (2021) 1. Plan/Design > Engage/Consume > Run/Manage/Monitor > Build/Integrate FASTER!
  • 7. Benefits of using APIs api3.org | 7 Benefits & drivers 1. COVID-19 and Digital Transformation 2. Ecosystem economics & economies of scope 3. Improved customer experience 4. Continuous innovation 5. Increased efficiency: focus on making their digital assets readily accessible. Easier for all participants to develop unique products, services and functionality quickly and with less cost. 6. Fast delivery: having open, modern industry-accepted development tools = faster to build and bring products to market and new opportunities for revenue more quickly. Risks 1. Data breach: Data misuse and abuse by criminals wishing to take advantage of weak API security 2. Data hostage: Power held by “aggregator” firms. Once they aggregate a critical mass of global digital users, monopoly position to dictate the terms of data access and API usage.
  • 8. Open Finance api3.org | 8 Open banking (OB) and insurance is a subset of open finance 1. An extension of OB data-sharing principles to enable third party providers to access customers' data across a broader range of financial sectors and products, including savings and investments 2. Decentralized Finance (DeFi & Web3.0) 3. Centralized Finance (CeFi & Web 2.0) 4. Cross sector & Ecosystem focus
  • 9. Open Banking api3.org | 9 Open banking mandates or encourages financial institutions to allow authorised third parties access: 1. To individual and business customer data (e.g. account information). 2. To financial services (such as payment initiation). 3. Following customer consent. 4. In a machine-readable format (API). 5. Established by regulators or from market demand. 6. PSD2 (Second Payment Services Directive) 7. GDPR (General Data Protection Regulation) & other Global Privacy Regulations
  • 10. Open Insurance api3.org | 10 The Open Insurance movement is growing but not mandate as of yet. This would follow in the success of open banking footsteps: 1. Allow consumers to access and share their data with other insurers or third parties, in a safe, agile, accurate and convenient way 2. Interoperability & Integration 3. Placing the customer at the heart of the business and processes 4. Creating new use-cases that would not be possible. Parametric insurance, integration with 3rd party service providers e.g. medical practitioners, auto repairs). 5. Insurance-as-a-service (IaaS) – micro-insurance 6. Some equivalent of PSD2 & GDPR Some nations pursuing this through public consultations 1. SUSEP (Brazil) , Superintendence of Private Insurance- Just published guidelines & standards 2. EIOPA (EU) , European Insurance and Occupational Pension Authority (EIOPA) / European Commission’s Digital Finance Strategy 3. Open Insurance Initiative (Italy), Italy Working group – API Playground Willis Towers Watson estimates 67% of insurers will modify business models by 2025. 1. AIA’s partnership with WeDoctor (110 million users) – win-win- Medical Insurance 2. ‘InsureMyTesla’ - uunderwritten by AXA to simplify car insurance 3. Ping An + Samsung with Samsung’s digital health capabilities, such as heart rate sensing smart watches. 4. Nationwide & RiskStream exploring interesting use-
  • 11. Healthcare and APIs api3.org | 11 Enable better access to health information for patients, improve interoperability and unleash innovation: 1. Department of Health and Human Services (HHS) put together rules that give healthcare consumers access to their personal data. 2. The CMS (Centers for Medicare & Medicaid Services ) rule targeting U.S. healthcare organizations. 3. Improve Interoperability & Integration at the core digital healthcare system (FHIR R4 standards). 4. Health insurance companies expose clinical and claims data of patients as FHIR compliant APIs to the patients themselves, or to third-party systems that the patient selects. 5. HIPAA Compliance & GDPR. Industry APIs 1. EHR (Electronic Health Record) APIs, 2. Consolidated APIs to access patient data, 3. Clinical data management and analytics APIs, 4. Public health content APIs, 5. Drug data and drug interaction checking APIs, 6. Symptom checker APIs. and 7. Telehealth APIs. Implications 1. Patient has portable health data, 2. Provide data for custom gene or medical therapy, 3. Patients decide and are remunerated for their health data, 4. E.g. users connect iWatch data for lower medical insurance premiums (Discovery Insure).
  • 12. api3.org | 12 ▵ Open Bank Project is the leading open source Open Banking solution. ▵ Standard Catalogue of 400+ APIs covering several standards. ▵ Vibrant global developer and partner community of 11k+ ▵ Berlin and UK based consulting and software engineering business. ▵ Started Open Bank Project in 2010. ▵ Inspired UK Open Banking, Berlin Group, Australian CDR, & recently Mexico Open Finance. OBP Customers
  • 13. api3.org | 13 OBP works with many of the world’s largest financial institutions 60+ FI Customers 11K+ Developers Regulators 20+ Partners ~
  • 14. api3.org | 14 ▵ Since 2018, API3 predecessor worked on connecting APIs to Web 3.0. Limitations drove us to innovate. ▵ API3 is DAO-governed. ▵ Integrations to multiple EVM compatible chains, inc. Ethereum, Polygon, Fantom, Harmony, Plasm, TomoChain, Conflux. ▵ Investors inc. Digital Currency Group, Placeholder, Pantera, CoinFund, Accomplice, Hashed. ▵ API3 + OBP enter into a 10 year partnership to bridge OB APIs to Web 3.0. API3 Investors API3 Partners
  • 15. API3 Overview api3.org | 15 API3’s mission is to make APIs fully compatible to Web 3.0 ▵ APIs are the glue to the internet. Salesforce, Ebay, FB, Google, Expedia, Uber, Airbnb are powered by APIs. ▵ Web 3.0 must be able to access the kind of services that Web APIs offer in order to interact with the real world. ▵ Connecting APIs directly to Web 3.0 will create new dAPPs and digital agreements, expanding the markets for decentralized networks.
  • 16. The API Connectivity Problem ▵ Due to the way blockchains internal mechanisms achieve consensus, blockchain applications cannot natively connect to external data. ▵ Current connection solutions depend on middlemen ○ API providers require expert management to connect to Web 3.0, which is not scalable. ○ Many API providers hire third party companies that deliver and re-sell the data for them. ■ API providers risk GDPR breaches, spillage, and unauthorized data resell. api3.org | 16
  • 17. api3.org | 17 The API Connectivity Problem ▵ Previous solutions focus: how can blockchains as technology connect to APIs. ▵ API3 focus: how can APIs as a technology connect to blockchains. ▵ Data sharing happens through APIs. All APIs have adapters and standards to share such data. ▵ No uniform standard API adapter exists for APIs connecting Web 2.0 data to Web 3.0.
  • 18. Airnode — An API Gateway to Web 3.0 api3.org | 18 ▵ Airnode is a simple to use, open source API gateway that allows APIs to directly connect to Web 3.0, without active management or the use of third parties. ○ Quick set up (minutes) ○ Set-and-forget (maintenance free) ○ Free for API providers to deploy ▵ Airnode allows the API provider to retain full control of their data, allowing them to be fully GDPR compliant when transacting in Web 3.0 environments. ▵ API3 & OBP will provide 400 OB APIs to Web 3.0.
  • 19. api3.org | 19 Tap into external APIs from other financial services providers to use financial data and create innovative applications and new business models. Insurance dApps Pension Funds Bank account information Payment Initiation Open Finance Data For Web 3.0 Open Banking APIs Enable: ○ Read Account Information. ○ Payment Initiation. ○ Banking-as-a-Service. ○ Banking-as-a-Platform. ○ Account Aggregation - Credit Scoring ○ Insurance, stocks, and pensions ○ DeFI<>TradFi
  • 20. api3.org | 20 Web 3.0 Services Platforms API Layer Open Finance Data Core Banking Airnode Connected with Open Bank Project APIs Accounts Payments KYC/AML Branches/Products Metadata API Metrics & Docs Web 3.0 Connections Self-sovereign Identities CBDCs Wallet aggregation DeFi Parametric Insurance Blockchain Banking Services
  • 21. Partnership For End- to-End Open-Source, Open Banking on Web 3.0 api3.org | 21 Open Insurance being explored for Web 3.0 and beyond

Editor's Notes

  1. Greetings Company mentions Topic introduction
  2. Ask them to write questions in the chat
  3. From right to left
  4. Defi is the tip of the iceberg
  5. The largest application (app) companies of our generations are APIs at their core.
  6. Question becomes: how do we get data onto the blockchain.
  7. Question becomes: how do we get data onto the blockchain. To understand that we have to understand how the blockchain works. What standards is being used to share data so we don’t re-create the wheel
  8. Kleros Curve Labs DAOstack ChainAPI Emurgo dlab etc… (will provide these asap)