NXTsoft’s OmniConnect standard API solution provides API connectivity that can connect any U.S. financial institution to any 3rd party system with a singular API
NXTsoft (nxtsoft.com), the market leader in comprehensive, secure API connectivity for fintechs and financial institutions has created an Application Program Interface solution (API) that provides standard connectivity to all banks and credit unions, leading the way in facilitating open banking in the United States.
Open banking refers to the sharing of financial data of account holders with third party financial service providers through a secure API. In Europe, PSD2, which was mandated for European banks by December of 2020, was enacted to boost digital banking innovation while increasing security and consumer rights, thereby fostering innovation and protecting customers with a single regulatory effort. The main technological requirement for PSD2 compliance is providing an API that allows account information service providers access to customer information when it’s granted by the consumer.
The United States does not currently have a law like PSD2 and as such banking innovation may be lagging behind Europe. Fintechs and financial institutions in the United States are faced with a variety of archaic, legacy IT infrastructures that can impede the implementation of new solutions. Although banks can choose to follow good programming principles and use APIs for both internal and external data transfer, these APIs may be homegrown and therefore proprietary and not standardized. It is difficult for a third-party developer to interface with multiple banks if the banks all use their own proprietary APIs.
NXTsoft’s OmniConnect standard API solution provides API connectivity that can connect any U.S. financial institution to any 3rd party system with a singular API. With growing list of partners such as Kasasa, Abrigo, ICE Mortgage Technology, Bankpoint and the ability for fintechs to write directly to NXTsoft’s OmniConnect, NXTsoft’s technology provides a standard of connectivity enabling financial institutions to plug and play the connectivity they want without costly and time-consuming efforts. OmniConnect designed to make the data sharing process transparent to the consumer, the fintech company and the financial institution while at the same time limiting the amount of consumer data that needs to be shared to accomplish the end goal and to not compromise the security of the consumer’s account.
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Currently in the United Sates, anytime a fintech company wants to connect its application to a financial institution’s core system they have to engage software engineers on staff at a cost of $100k + annually per developer to write integrations and then continue to rely on those personnel as the core processor authors 4-6 enhancements and upgrades per year. Similarly, the financial institution could build their own API, but not only would they have to build it, but they would also have to maintain it, update it, support it and secure it. NXTsoft’s OmniConnect removes that entire burden from fintechs and financial institutions, significantly reducing time to market, costs, headaches, and paves the way for an open banking platform.
It is imperative moving forward that if a financial institution utilizes an API for third-party connectivity, that it not only be standardized, but it will also need to be licensed all the way from the core banking system to the fintech company or other third-party service. NXTsoft’s OmniConnect standard API solution has this licensing and therefore is the only U.S-based licensed and compliant API provider.
NXTsoft’s OmniConnect standard API solution enables financial institutions to leverage the myriad of fintech players and third parties to either outsource services that banks no longer want to do, or as a potential lead generation source.
“Open banking puts the power in the hands of financial institutions and consumers. Financial institutions can implement the services the want and consumers can bank when and where they want, confident that their personal data is secure,” said David Brasfield, CEO of NXTsoft. “NXTsoft is excited to have created a standard API solution that facilitates this connectivity and forward progress,”
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