New Zealand is launching an industry pilot to test two APIs as it becomes the latest country to adopt open banking.
The pilot, which is led by Payments NZ, will test two APIs, the technology tools which allow easier digital transactions. The first is an account information API, which will enable development partners to make pre-payment checks, such as confirming account details are correct and that there are sufficient funds to make a payment.
The second, The Payment Initiation API, will enable third-party development partners to set up and make an electronic credit payment by connecting directly and safely with bank development partners.
Both are fundamental building blocks to answering consumer and business needs around the simplification of digital transactions and service propositions according to Payments NZ CEO Steve Wiggins.
Over the past 18 months, Wiggins and his team have met with a wide range of industry and ecosystem stakeholders, from FinTech startups to large tech organisations and government departments.
A working group has spent the last four months working to develop the API standards. Six development partners, including ASB, BNZ, Datacom, Paymark, Trade Me and Westpac, are conducting the pilot and will feed valuable insights into the refinement of the API standards and design of the framework.
The API standards being testing have been adapted and modified from the UK’s open banking API standards. A shared API framework, that is ‘right-sized’ for the New Zealand market, will significantly increase efficiencies and enable new innovations to get to market faster according to Wiggins.
“The opportunity for a shared API framework sits alongside five other strategic priorities currently being investigated by industry: 365-day service availability, proxy identifiers, speeding up payments, request to pay, and the ISO 20022 payments messaging format,” he added.
“The ultimate aim is to have a shared API framework and agreed specifications for a range of common APIs that will contribute to the aspiration of a progressive payments ecosystem. The pilot is a huge step towards that and an easier life for New Zealanders.”
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