By Kelly Hilbert, Strategic Account Manager, Asia and Emerging Markets at Confirmation

Technology is advancing at light speed and transforming even the most highly regulated industries, such as banking and accounting. Greater accuracy, trackability, productivity, and regulatory compliance are some of the key goals fueling increased digitalisation. As this push increases, the conversation remains incomplete without the mention of APIs.

The Rise of APIs

API, or Application Programming Interface, in simple terms, is a set of tools and protocols which allow different software applications to communicate. APIs facilitate the exchange of crucial data and information across different programs and applications and ensure they operate seamlessly.

In the 23 years since Salesforce released what many consider to be the first modern API, the use cases for API’s has expanded well beyond basic information sharing. Most major organisations now use APIs to streamline repetitive and time-consuming tasks, reduce errors, introduce automation, and free up human resources for more strategic and high-value work.  This growth is expected to continue, with the global API management market expected to rise by over 25% annually, reaching around USD 14-15 billion within 5 years.

As updates and upgrades become mainstays in the face of rising technological evolution, APIs can ensure older software communicates easily with new ones. This becomes especially important for industries such as accounting and banking, as they have legacy systems and processes containing vital information. APIs step in to do the heavy lifting and create the required connections between the new solutions and the legacy systems.

Some of the key reasons to leverage APIs in today’s business environment are:

Higher Efficiency

APIs allow organisations to automate tasks and processes. They support interconnections among all manner of devices, applications, and data to increase efficiency and productivity.

Enhanced Customer Experience

APIs elevate the customer experience by helping companies deliver personalised experiences.

Lower Costs

Automation, lower downtime to connect processes, higher security, and faster response time between processes without adding headcount—these are all ways APIs reduce complexity associated with IT integration and drive cost savings.

Banking and APIs

The banking industry is leveraging APIs as customer expectations and technological advancements accelerate at a competitive pace. Apart from being deployed to create and customise end-user solutions, APIs also help bank operational areas and drive compliance by simplifying processes such as responding to audit confirmations.

In banking ecosystems, APIs are also emerging as the drivers of security along with convenience. Instead of relying on paper-based processes that are easily manipulated, APIs keep sensitive information protected by providing the systems a secure pathway to communicate with each other and share data. 

Banks can use APIs to:

Drive Seamless Connections

APIs help banks standardise how they connectand exchange data and provide secure channels to instantly share it across organisations and third-party service providers. Single Sign-On (SSO) is an example of an API that helps with maintaining systems access, plus it makes logging in to different systems easier for your employees.

Improve Operational Efficiency

Critical operational processes that were previously manual and paper-based, such as audit confirmation processes, get a tremendous boost using API integrations. These work securely with all related systems within the banking ecosystem. For example, the Confirmation auto-response API is a technical integration that allows your bank or department to automate audit confirmation responses, resulting in improved response times, reduced errors, and saved staff time.  It eliminates manual labour and helps banks receive, fill out and return completed confirmation responses in minutes rather than days.

Elevate Security

APIs also help banks improve the security posture of important confirmation processes as these allow firms to identify users through the firm’s credentials. They also encrypt information across all networks and allow banks to ensure compliance with the most exacting security standards. In addition they elevate access management capabilities and enable banks to have tighter control over those who can access critical processes like confirmations. 

Accounting and APIs

APIs are proving their worth in the accounting industry as the digitalisation of paper-based processes accelerates. Automating and digitising key activities such as audit confirmations is becoming strategically important. This is mainly owing to the increasing sophistication of confirmation fraud and the rising cost of compliance that goes beyond financial impact and extends to reputation damage.

APIs are helping accounting firms modernise, simplify, and streamline critical processes and eliminate manual steps. They assist audit firms in connecting new software to an accounting firm’s existing tech stack and guarantee that the outputs are based on the most current and accurate data available. 

Processes such as confirmations benefit immensely from APIs. API integrations can be put to work for activities ranging from automating user access to reconciling expenses.

API integrations can be used to:

• Identify and validate responders across the bank confirmation network and add new responders to the same.
• Track the status of confirmation requests and send out real-time alerts for a new activity or progress to the right stakeholders.
• Sync client data with internal platforms to drive processes.
• Create a comprehensive repository of confirmation information and automate the download and distribution of completed confirmation PDFs, attachments, and data points into the organisation’s internal tools and workpaper files.
• Lookup client engagement information and reconcile the transaction and associated charges for each client; facilitate the back-end reconciliation of fees to client engagements with complete transparency.
• Send confirmation requests to financial institutions, law firms, and accounts receivable/payable departments from within the firm’s workflow applications.
• Request client signer authorisation, and track and communicate client signer authorisation request statuses within the firm’s workflow applications.

Accounting firms with API integrations would deliver greater efficiency gains as they improve response times, reduce errors through intelligent automation, and save time and manual cost. 

The Future of API

As the pace of digital transformation accelerates, APIs emerge as the new workhorse. They provide repeatable and standardised blueprints for systems, applications, third parties, and all those operating within the digital ecosystem to help interact securely and seamlessly. These are immensely valuable to distribute efficiency, productivity, compliance, and consequently, profitability — broadly across the accounting and banking landscape despite the presence of complex, legacy technology. 

Confirmation, part of Thomson Reuters, pioneered the idea of digital confirmations more than 20 years ago and has provided API Integration solutions for our clients in the banking and accounting industries. Our API solutions for accounting firms enables a more efficient and accurate confirmation workflow, while bank API solutions support banks to automate their confirmation responses and data retrieval. Contact us to get more details.

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