Nowadays, we often use digital payment methods to make purchases in the marketplace. But, have you ever wondered how the process goes? How do banks and marketplaces connect with each other?
In that seemingly invisible process, Application Programming Interface or API comes in. For developers and business owners, APIs can make their work easier in achieving business goals.
API is an important element of open banking, a system that provides open access to financial data and information between banks, customers, and third-party developers. One example is BRIAPI, an open banking service developed by BRI.
Thanks to BRIAPI, you can choose a BRI Virtual Account (BRIVA) as a payment method in your favorite marketplace. You can also top up your e-wallet balance via BRI Direct Debit. These various features are real examples of BRIAPI open banking. So, let's dig deeper into what an API is, its benefits, how it works, and its types.
What is API?
API stands for Application Programming Interface or can be interpreted as software that functions to connect an application with other applications. With the API, two applications that were originally completely unrelated can be connected and integrated so that they are able to communicate the features between them.
In simple terms, API is a bridge between two separate landmasses. This bridge is built with a set of code that provides multiple access points so that information from application A can cross over to application B seamlessly.
In application development, API plays an important role since it allows an application to access and share data, features, services, or operating systems with third-party developers. Thus, it can be concluded that the API is a 'bridge' that facilitates users to achieve their goals.
The use of APIs in application development has various benefits, including:
1. Develop applications more quickly and effectively
From the application development side, integration between two applications with an API can clearly help them to connect their features with no more hassle. It will also inform feature updates to make work faster and more effective.
2. Create functional apps
No more manual and exhausting information inputting process; all resolved if you use the API. Focused on functionality, API can integrate their features, making them more functional and beneficial.
3. Lighten server workload
By using API, the server no longer needs to find and store large amounts of data. If at any time some data are needed, we can request the API to retrieve the data from the origin server.
You will also get all of the above benefits when you use BRIAPI as an application integration bridge. Whatever business you run, BRIAPI will make the transaction experience easier for your customers.
As a software, API has its own architecture. The API architecture is the data form within the server and database so the API function properly. It allows developers to create a reusable application ecosystem—ideal for developing microservices such as APIs.
In general, there are three types of API architecture. Those are as follows:
1. RPC (Remote Procedure Call)
Remote Procedure Call or RPC is the simplest form of API interaction. RPC is used to support seamless communication between the client side and server side.
There are two types of RPC, namely XML-RPC and JSON-RPC. The difference between the two lies in the data transfer mechanism. Just as the name suggests, XML-RPC uses XML as a data transfer mechanism, while JSON-RPC uses JSON.
2. SOAP (Simple Object Access Protocol)
Simple Object Access Protocol or SOAP is an information exchange protocol for web services. SOAP uses XML as the information exchanged format. SOAP allows developers to process applications on different operating systems (OS), such as Windows, macOS, or Linux.
3. REST (Representational State Transfer)
Representational State Transfer or REST is an API architecture that is commonly used in API development thanks to its simplicity. REST is the guideline for creating reliable API services. An API service that meets the REST standard is called RESTful.
BRIAPI uses REST as the main foundation of its products. This is because all endpoints in BRIAPI use REST as well as JSON format so the data size would be lighter. That way, the API will perform better.
How the API Works
Broadly speaking, the way the API works is as follows:
1. Application access the API
At this stage, the user accesses an application. For example, you want to buy an item in the marketplace. When you want to pay, one of the available payment options is BRIVA. After selecting BRIVA as the payment option, the marketplace application will access BRIVA API.
2. API makes a request to the server
After the application successfully accesses the BRIVA API address, the request will be forwarded to the BRIAPI server. Then, BRIVA API informs the BRIAPI server that BRIVA is selected as a payment option that needs to be followed up.
3. Server responds to API
When it finds data that matches the request, the server again contacts the BRIVA API. The data is in the form of a unique institution number, your name as a BRI customer, and the nominal amount to be paid.
4. The API relays the response to the application
Furthermore, the BRIVA API forwards the information from the server to the marketplace.
Types of API
There are three types of APIs that are most commonly used by app developers and business owners. They are:
1. Private API
Private API is an API that is used in application development on a limited basis. For example, the API from the back end is used to access the front end of a website.
2. Partner API
Partner API is an API that is shared with business partners who already have permission to use. The trick is to register with the API provider to get the permission.
3. Public API
As the first open API in Southeast Asia to receive PA-DSS (Payment Application Data Security Standard) certification, BRIAPI has collaborated with more than 570 partner companies, ranging from marketplaces, ride-hailing, fintech, to government agencies.
4. Composite API
Composite API is a combination of two or more API requests in a single request. The Composite API is useful for dealing with various interrelated, complex, and repetitive API requests. Thus, the Composite API can improve time efficiency and effort for users.
Example of API Usage
The following are two examples on how BRIAPI partners, Badan Keuangan Daerah Kabupaten Kepahiang and K24Klik, use the API. Both have acquired various benefits from BRIAPI, especially in terms of managing their financial process.
Badan Keuangan Daerah Kabupaten Kepahiang
Badan Keuangan Daerah Kabupaten Kepahiang (BKD Kab. Kepahiang for short) or Regional Finance Agency of Kepahiang Regency is a Regional Apparatus Organization in the field of regional income and finance. Before integrating BRIAPI, BKD Kab. Kepahiang had low accountability for regional financial management due to the lack of digitalization processes in regional finance institutions.
Take an example from local taxes payment. They still use manual payment methods, especially for those who live in rural areas. Besides, there are always discrepancies in tax records, leading to unaccountable financial statements.
To optimize financial services digitalization in their region, BKD Kab. Kepahiang integrated with BRIAPI in June 2021. They use BRIVA API which provides access to payments through Virtual Accounts.
Now, people can pay taxes easily through the BRImo application or BRI ATMs. They no longer need to come to the Kepahiang District BKD office just to pay taxes. No more pending taxes since BRIVA eases taxpayers to make transactions anywhere and anytime.
"Through our digitalization and collaboration with BRIAPI, we hope Kepahiang can be a benchmark for other regional and provincial governments to always improve their public service in terms of quality and performance, especially in the financial service,” said Head of Revenue Division of BKD Kepahiang Regency, Amarullah Muttaqin.
K24Klik is the first and most comprehensive online drug buying application in Indonesia. Under PT K-24 Indonesia, K24Klik relies on the digital ecosystem to provide the best services. One important infrastructure is a wide range of digital payment methods.
However, cashless payment methods such as manual account transfers still have many drawbacks. Starting from customers who have to send proof of transfer, time-consuming payment verification processes, to the complicated process of checking mutations.
To tackle those issues, K24Klik integrates BRIVA from BRIAPI in order to provide BRI Virtual Account services. As a result, BRIVA has become one of the fastest and most efficient digital payment methods.
As a result, BRIVA increases the effectiveness of customer payments by up to 50%. BRIVA also helps skyrocket the transaction number to 200% compared to using manual account transfers. In terms of time efficiency, BRIVA users only need under 10 minutes to complete a transaction, much less than manual transfers which take more than 30 minutes.
"Hopefully, when the BRIVA integration runs optimally, the entire payment process for our customers will be easier, faster, and more efficient," said Finance K24Klik Maria Hartanti.
So, have you understood more about the API? As a bridge between applications, API assists business owners, developers, and customers to run the business smoothly. And as an API service provider, BRIAPI is able to increase the flexibility of services and bring you one step closer to 170 million BRI customers in Indonesia. Start BRIAPI integration now.