Use of APIs, or Application Programming Interfaces, has taken on growing importance as the asset management industry drives for digital transformation.

The API provides a digital ‘gateway’ through which an organisation can provide access to data or services, establishing a standardised set of requirements that govern how one software application can talk to another.

By connecting through APIs, multiple companies can establish an API ecosystem, providing a framework for data sharing and co-operation, while ensuring standardisation and consistency of data transfers between them. This may be combined with cloud-based data management, including data-as-a-service approaches, to deliver greater efficiency to data storage and data communication.

Data-as-a-Service (DaaS) – like software-as-a-service, or SaaS – is a cloud-based strategy that involves delivering information to end users via a network, typically utilising APIs, rather than running applications on locally-based (‘on premises’) servers. Just as SaaS removes the requirement to install and manage software locally, data-as-a-service supports data storage, integration and processing operations from the cloud.

Use of APIs offers opportunities for financial services organisations to refine their product set and to rethink their delivery strategies, delivering improved standards of data transfer to its customers – while enforcing high standards of security and governance around this process.