The DIY solution has a few downsides
Of course, working with a TSP that provides the connection to many different open banking APIs is completely optional. European banks are legally required to make their open banking APIs available to the public and to provide a sandbox environment to go along with them. In theory, that gives you all you need to make your open banking connections yourself.
In practice, it’s not that simple. Below, we’ll share some lessons we learned from connecting to dozens of open banking APIs while building the YTS platform.
Many sandboxes suffer from uptime issues. Developing your application involves much more guesswork when you can’t be sure that a failed connection is due to an error in your code or an unresponsive sandbox.
Many sandboxes don’t correspond to the production environment. Ideally, working with a bank’s sandbox environment prepares you for connection with the actual bank. Not 100% – sandboxes often use fictional data and simplify the authentication process. But definitely to the level where the code you have developed for other parts of the connection should still work.
In practice, the sandbox often does not look like the production environment at all. What that means for a development team is that connecting to the sandbox will not save time in connecting to the bank itself.
One sandbox – or one bank – is not like the other. To be able to offer a great service, you need to connect more than a single bank. But just like connecting to a sandbox may not save you time in connecting to a bank, connecting to one bank will usually not save you any time in connecting to the next.
Banks use very different approaches when developing their open banking APIs, so what you learn by connecting to one API does not apply to another API at all. Even the main standards – from the OBIE, STET or the Berlin Group – result in very different APIs once all the details have been hammered out. We have now connected many open banking APIs in different countries, and we still run into API and sandbox designs that we have to figure out from scratch.
Embracing the middle man
By using a TSP such as YTS, you cut out many of the issues by connecting through a single API.
Setup and maintenance. Instead of having to connect to banks one by one, you only connect to the TSP API, which handles all the bank connections. Eliminating that first connection to the individual banks saves a lot of time. And since banks update their API regularly – which may drastically change the way they make their connection and do the authentication – you’ll save much more than just that first connection.
Same team for the sandbox and the production environment. At YTS, both environments have been developed by the same team. We, too, simplify the sandbox authentication process: for the sandbox, YTS provides the required mutual TLS certificate, while for the production environment, a third party provides it. But everything else works in exactly the same way.
Fully dedicated to uptime. Since the YTS platform is also used by our own Yolt app, which serves over 1.2 million registered users, uptime is our top priority. The YTS sandbox runs on the same Kubernetes cluster as our API, so whenever something is wrong, the right person gets alerted and steps in immediately.
Get started today
In other words, for any ambitious fintech or leading financial institute looking to step into open banking, working with a TSP is an investment that will pay itself back in no time at all. Want to try it out for yourself? You can access the YTS sandbox on our Developer Portal by just signing in with a GitHub account. And once you have the sandbox up and running, you will be able to reuse the code you developed for the production environment as well. That’s our promise.