Global API Banking Market Size to worth USD 140.45 Billion by 2033: Market Statistics Report

Global API Banking Market Size to worth USD 140.45 Billion by 2033

According to a research report published by Spherical Insights & Consulting, the Global API Banking Market Size is Expected to Grow from USD 20.35 Billion in 2023 to USD 140.45 Billion by 2033, at a CAGR of 21.31% during the forecast period 2023-2033.

Browse key industry insights spread across 210 pages with 110 Market data tables and figures & charts from the report on the Global API Banking Market Size, Share, and COVID-19 Impact Analysis, By deployment model (On-premise, Cloud-based, and Hybrid), By Application (Payment Processing, Account Management, Loan Origination, and Data Analytics), and By Region (North America, Europe, Asia-Pacific, Latin America, Middle East, and Africa), Analysis and Forecast 2023 – 2033.

API banking, or application programming interface banking, is a system that enables banks to share their data and services with third parties through secure APIs. This approach allows third parties to develop financial products and services for customers, opening up new business models for banks. The API banking market is driven by several factors. Banks use APIs to modernize their operations and enhance customer experience. APIs facilitate integration with third-party applications, such as mobile banking apps, enabling banks to offer personalized services. Regulations like the Revised Payment Services Directive (PSD2) in the European Union mandate that banks share their customer data and payment infrastructure through APIs. This requirement fosters competition and collaboration between banks and FinTech startups. However, the API banking market faces some challenges. Open banking APIs necessitates sharing sensitive data with third-party providers, which heightens the risk of data breaches and fraud. Consumers are often concerned about the potential misuse of their personal and financial information. Additionally, financial institutions and banks sharing customer data via open banking platforms may make that information accessible to competitors.

The cloud-based segment is predicted to hold the largest market share through the forecast period.

Based on the deployment model, the API banking market is classified into on-premise, cloud-based, and hybrid. Among these, the cloud-based segment is predicted to hold the largest market share through the forecast period. Organizations are increasingly choosing cloud solutions for their scalability, flexibility, and cost-effectiveness. These solutions enable quick deployment and simpler resource management, which is particularly advantageous for startups and small to medium-sized enterprises. Furthermore, the growth of digital transformation efforts and the increasing need for improved data security further propel the adoption of cloud services, making them a favoured option for businesses aiming to optimize their operations and enhance customer experiences.

The payment processing segment is anticipated to hold the highest market share during the projected timeframe.

Based on the application, the API banking market is divided into payment processing, account management, loan origination, and data analytics. Among these, the payment processing segment is anticipated to hold the highest market share during the projected timeframe. This trend is primarily driven by the increase in e-commerce and digital transactions. As shoppers show a growing preference for online purchasing and contactless payment options, companies are forced to upgrade their payment processing systems to meet these demands. In addition, innovations in payment technologies such mobile wallets and blockchain enhance transaction security and efficiency, rendering robust payment processing systems essential for businesses striving to stay competitive in a fast-changing market.

North America is estimated to hold the largest share of the API banking market over the forecast period.

North America is estimated to hold the largest share of the API banking market over the forecast period. This growth is largely due to the advanced financial infrastructure in the region and the widespread use of digital banking services. The presence of prominent fintech firms and traditional banks that are integrating APIs into their offerings improves customer experiences and stimulates innovation. Moreover, supportive regulations and a tech-savvy consumer base facilitate the development of API banking solutions, establishing North America as a major player in this sector.

Europe is expected to grow the fastest during the forecast period. This expansion is driven by regulatory frameworks such as PSD2, which promote open banking practices. Such regulations not only foster competition but also encourage innovation within financial institutions, allowing them to develop new, customer-focused services. Additionally, the rising consumer demand for tailored banking experiences and smooth digital interactions further accelerates the uptake of API-driven solutions in the region, solidifying Europe's position as a leader in advancements in API banking.

Company Profiling

Major key players in the API banking market includes Visa, nCino, Bankin, Finastra, PayPal, Rapyd, Plaid, Worldpay, Temenos, Thought Machine, Adyen, Railsbank, Mambu, Stripe, Bond, and others.

Recent Developments

• In September 2024, Standard Chartered announced a partnership with the National e-Governance Services Ltd (NeSL) to introduce an innovative electronic Bank Guarantee (eBG) feature in India. This feature adheres to the open Application Programming Interface (API) standards established by ICC and SWIFT and represents a notable advancement in the progression of digital trade finance. The eBG allows Standard Chartered and its clients to oversee the entire life cycle of the guarantee digitally and offers real-time visibility throughout the ecosystem for all parties involved to manage and track their guarantees.

Key Target Audience

• Market Players
• Investors
• End-users
• Government Authorities 
• Consulting And Research Firm
• Venture capitalists
• Value-Added Resellers (VARs)

Market Segment

This study forecasts revenue at global, regional, and country levels from 2023 to 2033. Spherical Insights has segmented the API banking market based on the below-mentioned segments:

Global API Banking Market, By Deployment Model

• On-premise
• Cloud-based
• Hybrid

Global API Banking Market, By Application

• Payment Processing
• Account Management
• Loan Origination
• Data Analytics

Global API Banking Market, By Regional Analysis

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Spain
  • Russia
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Rest of Asia Pacific
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Middle East & Africa
  • UAE
  • Saudi Arabia
  • Qatar
  • South Africa
  • Rest of the Middle East & Africa