Chile’s BCi has joined the wave of banks launching open API platforms, hoping to generate new products with fintech partners that will position the institution to offer services at crucial moments for their clients – such as the purchase of properties and cars.
BCi’s API Market is the first move by a Chilean bank into what’s been called the ‘API Economy’, a global trend designed to fast-track joint product development and new distribution channels. It follows similar API advances by Mexico’s Banco Azteca, Citibanamex and BBVA.
BCi, one of Chile’s biggest retail banks, hopes that its latest move will lead to new partnerships and business models, better user experiences, and, ultimately, enable them to capitalize on the growing demand for financial services in the virtual world.
Real estate platforms are an example of this, says Pedro Zegers, product owner senior at BCi.
“In mortgages, we realized that when clients want to buy a property, they start their journey not in the bank, but in a real estate agency or a marketplace to look for those properties. Bringing the mortgage simulator to these scenarios makes it much easier and makes the experience better,” he said in an interview with iupana.
Hosting the bank’s services on this type of platform allows the client to simulate the amounts and terms of their mortgage, simplifying the user’s journey. This integration – which is already live – is just one of the solutions that will be enhanced by new API-based connections with third parties, said Zegers.
The bank is developing products for different needs and verticals, he added.
“We are promoting a consumer credit API for individuals; that is, one that can simulate a loan to see whether or not the person can be financed outside the bank. For example, when buying a car, or some high-value product that requires financing,” he explains.
From the user’s point of view, the main tangible advantage is fewer steps to complete an action. Additionally, a Product Identity API allows the bank’s customers to share their personal profile data (name, address, email, etc.) in authorized applications or platforms belonging to the bank’s partners.
“The main benefit for the users is that they will have cash flow with less friction, saving time, and being present as a bank at the moment we know the client needs us,” adds the executive.
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Open banking, and other challenges
Partnerships based on BCi’s API Market will strengthen the bank’s innovation strategy and, potentially, position it for open banking regulations in Chile. However, Zegers recognizes that in this first stage they have are focusing more on achieving a good market placement.
In late 2020, the Chilean Treasury Department announced that it would begin developing regulations for open banking, to promote competition among financial institutions in the country. However, Zegers expects that these regulations “will take time”. For now, its APIs are designed to connect with the digital ecosystem, rather than address the incoming regulations.
Aside from regulation, Zegers says the biggest challenge is understanding the needs of customers, and creating relevant solutions for them. Also, to demonstrate – even within the institution itself – that collaborative technological environments can add value to banking products.
“Putting the client at the center of any development and seeing the opportunities that exist via APIs has been the main non-technological challenge of this project”, he said.
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