API: Making payment transactions more transparent
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How APIs increase transparency within payment transactions.

Delays in payment transactions cost banks time and more importantly, money. Innovations based on APIs help address this global situation.

Market practice with optimization potential

Keeping an overview of countless daily transactions can be a challenge for banks. On top of that, unforeseen delays frequently arise in international and domestic payment transactions. To avoid any opportunity costs or debit interest, account balances have to be continuously monitored. In practice, this is often still carried out semi-manually, which is time-consuming and ties up resources. Isn’t there a better way?

Application programming interfaces – or APIs – can make it easier for banks to obtain relevant information. The technology can deliver the data directly into core banking applications, thereby enabling cash flows to be monitored on an efficient basis. In addition, this speeds up the bank's response time in relation to day-to-day payment transactions as APIs enable faster processing of payment orders that have not been executed due to insufficient funds in the account. Lastly, efficient liquidity management is important for complying with current regulatory requirements, e.g. that there is sufficient liquidity at all times to meet payment obligations.

Automatic notifications facilitate liquidity management

Credit Suisse has recognized the potential of programming interfaces and is using the technology for its own payment transactions. "APIs create greater flexibility, and allow us to proactively respond to possible delays. In addition, they can be used to mitigate operational risk," explains Raoul Casellini, Head of Global Cash Clearing & CLS Management at Credit Suisse.

With a view to sharing the advantages of APIs with its clients, the long-established Swiss bank has developed three innovative API-based solutions that actively inform banks about their daily and monthly transaction activities using automatically generated communications:

Intraday Liquidity Threshold Alerting

If the account balance is below or above a predetermined threshold, a notification will be generated in order to inform the bank. This gives it the opportunity to respond well before the clearing stop and avoid any costly unplanned positions. It therefore eliminates the need for manual queries. Intraday liquidity threshold alerting not only increases the bank's response time but also helps improve daily liquidity management and therefore the ability to meet payment obligations.

Intraday Liquidity Reporting

Intraday liquidity reporting displays the development of individual account balances on a continuous basis, enabling banks to identify how much liquidity is available at any particular time during the month. This transparency can help a treasury department to better manage regulatory adjustments associated with liquidity management, for example.

Blocked Payments Notification Service

If an outgoing payment cannot be executed because the account balance is insufficient, a notification is automatically sent to the bank. This allows the bank to intervene quickly and prevent delays occurring to transactions. The blocked payments notification service replaces manual notification via email and/or SWIFT.

Significant added value for third-party banks

Credit Suisse is one of the few major banks to offer these innovative solutions to third-party banks. "By doing so, we're creating significant added value for our clients. Fact is, proactive digital notification is a reliable way to prevent unwelcome surprises from occurring in day-to-day payment transactions," says Raoul Casellini.

In addition to these innovative digital notification services, Credit Suisse also offers direct data access from its systems as part of its Open Banking API initiative.