Monzo, an API-first bank, has launched an interim API (the AIS API) to comply with Europe’s Payment Services Directive (PSD2) which recently became law. The AIS API includes three core functions: list of accounts, list of account’s balance, and list of account’s transactions (all features specifically addressed by PSD2). Monzo plans on building all features of the AIS API into its standard developer API, but that transition will take some time; and the law requires compliance now.
Open Banking regulations have been on the rise, and vary in maturity and enforceability depending on jurisdiction. Monzo and other API/app focused startups in the banking industry see these regulations as an opportunity to disrupt an industry traditionally dominated by a small number of massive institutions. Monzo believes its API-first approach enables it to reach bank customers where they operate on a daily basis (i.e. on smartphones and the apps within those smartphones).
The AIS API is available to companies authorized as Account Information Service Providers (AISPs) by the Financial Conduct Authority (FCA). To achieve AISP status, companies must apply and prove their ability to follow PSD2 regulations, including the ability to keep account data secure, and use account data solely for the services account owners ask for. The AIS API is built to comply with AISPs responsibilities under PSD2.
As mentioned, Monzo classifies the AIS API as an interim API. To ensure compliance with PSD2, the functionality of the API will remain locked. Monzo will continue to innovate and release improvements to its Monzo Developer API. Eventually the AIS API will be retired when all of its features are compliantly added to the developer API. Check out the AIS API in the meantime, and follow the Monzo blog for further announcements.