Sending money electronically has given way to new modes of sending money both cross-country and internationally. Now, many financial technologies either rely on or are based solely on APIs, or application programming interfaces. APIs are compact bits of code that allow for the secure transmission of information, and they make intuitive sense for the financial world.
If you’re newly learning about money transfer APIs, it can be somewhat confusing. Money transfers APIs might, after all, use a third-party service to confirm a user’s identity, confirm the banking information, or facilitate the transaction.
To better understand this service, we’ve provided a breakdown money transfer APIs.
Reasons to Choose an API to Transfer Money
If you’ve ever sent money through an app, a banking service, or electronically, then you’ve basically been interacting with a banking API this whole time. Even getting a direct deposit, you might have been given that money through a money transfer API. In short, banking APIs work by connecting to a small subset of providers (referred to as endpoints) so that only the sensitive banking information is issued to the intended receiver.
Not only are banking APIs extremely secure and convenient, but they are pretty much the only way to send money electronically in 2021. If your business does not facilitate banking transactions through the use of an API, then it is likely that your business is falling behind. Whether it is using an integrative API that is implemented into your financial processing system or you want to develop an app entirely dedicated to processing your payments, APIs are essential to these services.
Choosing an API to transfer money just makes sense. Not only will your business provide a seamless experience to your customers, but you are also guaranteeing security and ease of use in the financial transaction process.
Money transfer APIs are extremely secure. Built into the API code is a range of security measures, designed to keep hackers at bay. APIs are built with a private API key. Without the API key, access is restricted and the API details are completely secure.
Similarly, a money transfer API like Sila can facilitate cryptocurrency transactions, which are extremely secure and allow for more widespread financial transactions globally. With very small transaction costs, speedy transfers, and ease of use, a banking API like Sila is the smart choice for individuals and businesses alike.
P2P/Peer to Peer
If you’ve ever sent a bank transfer online through your bank account, then you likely have interacted with a payment API. Additionally, apps like Paypal and Venmo are API apps that allow you to send a mobile payment to friends, family, and services as a peer to peer (P2P) payment.
In this digital age, sending money online or through a mobile device makes life a lot easier. You can send money as soon as you receive it or as soon as someone needs it. There is no longer any need to go to a bank to pull out cash or provide a check. Instead, through the convenience of an app, online shopping, or eCommerce site, or through a POS system, money can be sent with the click of a button.
Peer to peer (or P2P) is just one of the many ways in which money can be sent. One common P2P service provider is Venmo. A P2P payment app allows individuals to send money to other individuals who aren’t businesses and who don’t have any type of financial system set up.
This makes sending money to your friend so simple. It also allows small businesses to get up and running faster. For example, if you are a hairstylist and you are styling someone’s hair for a wedding event, you want to be able to travel to the site to do the service. You can’t expect your customers to have cash, so what other options do you have?
Small businesses might have to sign up with a service like Square in order to facilitate the transaction, but then the small business loses out on a percentage of their profit. Services like this might not be able to accept cash transfers and users may be required to send a credit card, making the transaction even more expensive for that individual.
With a P2P API, more individuals can send money anywhere in the world and with their form of currency. P2P APIs that take advantage of crypto can also tap into smart contracts, which ensure that money is paid for certain agreements, limiting much of the stress associated with an individual or peer API money transfers.
International/Cross Border Money Transfer
Sending money cross border or internationally is another tricky business. International transactions are possible, but they usually require the money to jump through a few hoops. This makes sense, but it can be entirely bothersome when trying to pay for something or give someone money.
International money transfers must be verified and their banking codes (or details) must be translated to a bank in a different country potentially using a different language. An international money transfer API can facilitate this transaction by translating the details through the international payment system. The API would have access to the SWIFT network, which is the only major network for processing international payments.
In order to provide this service, the fintech API needs to allow account linking and verification, ID, and business verification. Global transfer codes, such as International Bank Account Number (IBAN) numbers and Business Identifier Code (BIC) codes are required in order for the financial institutions to be able to communicate.
Additionally, moving through the international payment system network is not always necessary. Banking transactions can be sent through the cryptocurrency network or blockchain. Sending money transfers via crypto allows for faster and more affordable international exchange rates and minimal transaction fees. Sila has its own patented stablecoin, SILAUSD, for this reason, allowing businesses all over the world to securely tap into the highly profitable US market.
How to Choose the Right API for Your Money Transfers
Using an API for funds transfer is necessary for your business to keep up with the digital banking age. By implementing a money transfer API, like Sila, you will be able to better provide for customers and to open up the doors for international transactions and ACH payments.
A payment API like Sila can provide more opportunities for your business and for users. An API can offer a different payment method, allowing you to move away from the hassle and cost of working with credit card transactions.
Third-Party Sender or Third-Party Service Provider: Key Differences for Better Payment Processing
Discover the crucial differences between third-party senders (TPS) and third-party service providers (TPSP) in the fintech industry, their roles in ACH payment processing, benefits, and potential drawbacks. Learn how these entities impact businesses and improve payment efficiency.
What Are ACH Payments and How Do They Work?
With the development of ACH APIs, more technologies and apps are able to bypass bank controls and open up or expand the ways that Americans can control their money. Among online and app-based investing, ACH API development is allowing more and more Americans to freely exchange their money.
Understanding the Basics of ACH Fraud
ACH fraud is rare, but it affects security and trust. Mitigate ACH fraud with ACH APIs that outsource secure bank account linking and KYC data.
Common ACH Return Codes and How to Avoid Them
When experiencing an issue with an ACH payment processing, you’ll most likely receive a return reason code. Since these return codes can be a hassle, and most people do not like dealing with money issues, it is of your best interest to resolve ACH return codes as soon as possible.
How Long Does an ACH Transfer Take?
Identifying how long it takes for an ACH transfer to be completed is essential to our daily lives. We need to be able to stay on track of when money is leaving or entering our account so that we can provide accurate assessments in other parts of our lives.
Why an ACH Payment Isn’t Transferred Immediately
What’s with the delay? And when can you expect a payment to go through?