Payments NZ has been working with the industry to understand and prepare for a more open future in payments. Over the past year, we’ve been working on a shared API framework and pilot to bring common API standards and an API standards ecosystem to life. The objective of this work is to make it easier for organisations to partner using standards, so they can bring financial services innovation to market more simply and quickly.

We believe common API standards, supported by a management framework that can readily adapt to market demands, will be a foundation to building this more open future.

So what does the release of these standards mean? We’ve learned a lot over the past year since we kicked off the industry pilot and framework development. One of our key insights has been the value of getting some practical experience under our belts. This experience has been reflected in the standards we are releasing today.

Like with all pilots though, we encountered some challenges along the way. The pilot took longer than we originally thought. We learned that the development and build processes for banks and third parties takes time and technical specifications can be interpreted in different ways. Working out what should be standardised in the API specifications versus what should be left to individual solutions, takes a bit of time to figure out too. We learned it’s important to have a flexible management framework that will enable future iterations of the standards in response to market needs.

Going into the pilot we had assumed we’d approach the testing of both standards equally. However, as we progressed, the development partners found they had stronger use cases for the Payment Initiation standard within the constraints of the minimal viable product (MVP) environment. This led to a re-focusing of the group’s efforts toward testing the Payment Initiation API standard.

While the pilot focus was more on the payment transaction side of things, the Account Information standard was also developed and has been released. We’re interested to see what innovative new solutions will be created off the back of this standard.

As part of our work, we consulted with stakeholders from across the ecosystem. The feedback we received has fed into what has been designed and helped shape the API management framework. This framework sets out how organisations can access, use and contribute to the standards going forward. It forms the basis of a new Payments NZ API standards service, which will be opened in a few months’ time for organisations to become registered standards users.

In the meantime, we were eager to get these version 1 standards out in advance of the service, so people can think about how they might use them as part of their customer solutions. Today’s standards release marks the beginning of a bigger journey on the open road towards greater innovation.

Alongside this API workstream, through our Payments Direction programme we’re also working on investigating 365-day service availability, proxy identifiers, speeding up our payment systems, informative transactions and request to pay. Collectively, this body of work will help the industry ensure New Zealand has one of the world’s most progressive payments system.

Finally, I’d like to sincerely thank our pilot development partners: banks - ASB, BNZ and Westpac, and third parties - Datacom, Paymark and Trade Me. I’d also like to sincerely thank our other working group organisations ANZ, Kiwibank and Merco Limited. Having banks and third parties in the room working together has been of huge value. This work would not have been possible without the collective expertise, commitment and support of all of these organisations.