API Business Models

API-led core banking transformation


Luke Andrews is an API product manager at 10x Banking. 10x Banking is a cloud-native, core banking platform. This article by Luke Andrews discusses API-led core banking transformation.

Core Banking

Core banking looks after your brands as a bank. It also looks after your financial products, like current accounts, mortgages, loans, and all of your features against those, interest rates, eligibility rules, etc. It also manages your customers and the customer records, capturing all the information you need to understand and work with them. Once you’ve got your financial products and customers, you can unlock accounts, which is what we all have with our various financial institutions today. Following accounts, you have transactions, such as paying off your mortgage or sending money to your friend. Whenever there are transactions involved, there are calculations like the interest, etc.

As technology progressed, everyone built their bespoke core banks. Core banks were added with similar technologies and problems. We made a few tweaks to address issues but did not tackle the core problems. We added abstraction layers for customers, front-office staff, and back-office staff. This did not give us many opportunities for innovation. This impact our ability to innovate. The cost of change is outrageous. It has also impacted our speed to market.

What do banks need to do?

Banks must launch new innovative products to market to grow their share and maintain their balance sheet. They need to service their customers to delight them, not only their customers but also their colleagues. They should understand their customers and products. They also need to analyze their products’ performance and take corrective actions where necessary. Banks want to scale the model, whether moving into new geographies or segments or scaling up across the market.

Launching new and innovative products does not mean simple rewards or schemes. It means doing something different. It is not about pulling together multiple features to build financial products. Many different things can be done, but we cannot do them because we’re stuck in the silos of standard features.

The next thing banks need to do is to service our customers and make that easy for colleagues. As a customer, you want to share documentation and resolve issues over the phone without visiting multiple windows or swivel chairing. This is easy to achieve with a modern core banking platform that manages those key assets, where it’s API driven, with a single central data source.

To understand the company and its performance, we need data. Data and analysis of that data can trigger events that can be actioned. One of our biggest problems is loads of junk data in our systems. We have teams that cleanse data and get it into shape. But if we could have a single central data store, that would make everyone’s lives a lot easier to check those key entities you can see on the screen. And once you’ve got the data, you can become a data-driven company.

Risk and Compliance: Banks can use data to improve their risk models and comply with standards.

Personalization: Banks can use data, spending history, etc., to personalize products and offerings for their customers.

Scaling the Model 

This can mean many different things to many different banks. But what it means for me and the customers I’ve spoken to is, growing your existing client base. Growing your existing customer base in the cloud is just deploying more instances of your platform.

Moving into new segments is one of the easiest ways for banks to expand and grow their market presence. You need to create new products to move into a new segment. You need to think about your customer data model to check you’re capturing all of the information. APIs enable you to do this at the top layer, being standardized and consistent, and the bottom layer, where you can make changes.

Moving into new geographies can be challenging. There may be some data regulations that you need to abide by; you may need to move into a new cloud. The infrastructure may change, but you still have standardization and consistency with APIs.

Modern core bank

A modern core bank has a gateway at the top that does everything we know. Authorization, checking who you are, what you’re doing, rate limiting, protecting your services. You have standardized and consistent interfaces. The middle layer has products and services. The bottom layer has events that can be modified without too much disruption. This enables banks to focus on configuring and launching innovative products to market.

To win in this model, you have a standardized, easy-to-understand, easy- to-work with core banking that enables you to integrate with the ecosystem. You build a platform that is easy to integrate with all leading market solutions rather than building them in-house. That’s where the modern core banking platform unlocks the wider ecosystem.


Luke Andrews
An infectiously energetic product thinker, who has deep experience delivering technical products, projects and programmes. I've worked in large highly regulated enterprises through to rapidly changing and fast moving start-ups. I thrive on bringing clarity to ambiguous and complicated environments, with a relentless focus on delivering what the customer really needs. I bring structure and rational thinking, whilst accepting that constant change is a part of the process. I've built and led high-performing teams by being down to earth, and creating a challenging, yet fun, space to grow & develop. Currently leading a government 'start-up' and responsible for driving the adoption of APIs across an existing organisation of 3,000.

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