In the age of the Internet and digital technologies, APIs (Application Programming Interfaces) are changing entire business models and leading to the emergence of an API economy. Companies like Uber, Airbnb, or Amazon are built entirely on APIs and provide services through an interface for APIs to interact.
An API is a code providing an interface between two applications using routines, protocols, and tools that help the applications communicate with each other by acting as an intermediary. In addition, they ensure the security of the information transferred through encryption, user management, authentication, and other security measures. Thus assuring the legitimacy of all parties involved in the exchange.
They also standardize access and remove any dependency on the application’s technical aspects as APIs can integrate two applications regardless of the language, machine, operating system, or mobile device they are written in.
APIs also allow you to build apps that connect several apps and bring the functionality of all the apps onto a single interface.
Use cases of APIs in building new business models
APIs in Transport
In the age of Mobility as a Service (MaaS), as travelers start adopting a consumer mindset, demanding better connectivity, Mobility, and trust, there is an increasing need for service stakeholders to improve the delivery of their products, especially in the field of ticketing, payment, and loyalty.
Account-based ticketing offers a compelling and flexible solution to meet the needs of the transit ticketing industry. Using an open-API-centric approach allows the existing ticketing system to integrate technologies like UPI or QR codes and enables ticketing through contactless cards, wearables, and smartphones. This has helped operators with better customer identification, lesser need for transit-specific cards, and reduced the number of on-the-ground resources.
APIs in Payment
The payment services industry is currently undergoing a tectonic shift due to the influence of APIs. With the increase in customer demand for more flexible payment systems, banks are now facing pressure to build stronger relations with third parties who provide more advanced technologies, ultimately creating a better ecosystem.
Payment APIs help integrates multiple payment sources, provide a payment tracking mechanism to customers, and help them manage subscriptions. It also gives retailers more payment methods and enables a seamless customer buying experience across channels, thus allowing them to deploy an omnichannel strategy. A prime example of this is UPI (Unified Payment Interface), an instant payment system developed by NPCI that allows real-time cash transfer through a mobile interface using the receiver’s mobile number or QR code.
APIs in Ecommerce
With the retail sector increasingly going digital through their websites or online marketplaces, APIs enable retailers to manage inventory, keep track of orders and manage payments.
This is especially true in eCommerce sites, which have little to no inventory of their own and rely solely on the integration of third-party apps and products on their interface to solve the needs of their consumers. APIs have helped unify this commerce logic by providing accessible and secure connectivity between different applications.
APIs also enable retailers to collect accurate data on their customers, which can help them improve their customer shopping experience and ensure better customer retention.
the importance of a Strong Testing framework for APIs
The core functionality of an API is to enable the transfer of encrypted information. Failure or lack of adequate response from APIs can often lead to the crashing of applications or different actions from applications. Improper validation of APIs, especially those used for payment services, may result in reconciliation issues or fraudulent situations. If not properly authenticated and authorized, API failure could also lead to data theft.
Because of these issues, it is crucial to have a robust API testing and validation framework.
API testing helps to ensure that the APIs chosen align with functional requirements and seamless connectivity between the two applications. This testing is performed by sending requests to the API, getting a response, and validating that response against a pre-determined result. It also allows us to check the permissions granted to the user to prevent any vulnerabilities that could compromise the server.
Through continuous monitoring and API Testing, it is possible to ensure that you get a head start in case of any defect in the system, and fix the error before the partner or customer notices.
The types of tests that can be performed are:
- Functionality and Behaviour Test: This checks if the API chosen meets functional requirements. With a wide range of API tools available in the market, choosing one that is the right fit for the application is crucial.
- Performance and Reliability Test: This ensures that the API chosen can perform well, even under high pressure. This is done by testing its payload, stress-taking capacity, etc.
- Security: This validates whether the security requirements, like authentication and permissions, etc., are met.
Challenges in API Validation and Testing
Setting up suitable test use cases and ensuring that the proper API testing infrastructure is up and running is one of the biggest challenges developers face today. With many testing tools to choose from, it is essential to pick the right one that matches all requirements and allows the correct type of integration between applications to ensure the best experience for end-users. So often, API testing is entirely left in the developer’s hands, who is only experienced in testing and may not incorporate the proper governance structure. On the other hand, business teams struggle to perform appropriate API testing because of a limited understanding of the absence of the right testing tool.
With the changing requirements, updates, and payloads, regular maintenance is necessary to ensure that the testing tool chosen can capture any errors. To take the example of a bank and a third-party payment app like Google Pay, if Google Pay comes up with an update to offer new services in partnership with the bank, the bank now has to update its API to include these requests.
Testing tools usually ensure the working of APIs by entering requests and analyzing the response received from the system. But the tester must choose the suitable parameter combinations to enter and provide the correct answers are received. Failure to do so may leave undetected errors in the system.
Players in the market
Several tools are currently available in the market, enabling the implementation of the proper framework for API testing and helps automate the testing process. One of the players in the market is FIME, payments testing and consultancy expert, which has launched “TrustAPI+,” an automated open banking API test solution.
TrustAPI is an online or a standalone tool that provides a familiar environment to create, run and maintain automated functional and security test campaigns for generic REST APIs. It gives customers the option to choose between a standardized testing plan or create their customized testing solution tailored to fit individual requirements.
As the API testing landscape is unregulated and unstandardized, a legitimate need for a tool ensures that a trusted, open financial ecosystem is maintained, which meets regulatory, functional, and security mandates while delivering a frictionless customer experience. Through a unique and complementary API security evaluation approach, testing tools like TrustAPI+ ensure the authentication, authorization, confidentiality, and integrity of messages shared between the client and the service.
Source: FIME
Conclusion
Thus, API can be defined as a contract between the user server and the provider. API testing helps ensure that the data transferred between these applications is secure and pre-approved. Users need to keep in mind that API testing is a continuous process to detect and resolve system vulnerabilities before they can affect the end-user.
Before testing, applications need to choose the right testing tools and define the correct parameters. The testing is done by checking the request-response combination against a pre-defined one. API testing helps in preventing the functionality, performance, and security of the API.
Testing tools like TrustAPI+ from FIME reduce the testing time required and provide a level of assurance for the function and security of APIs. The device combines traditional testing with modern functional and security testing, allows users to develop entire test libraries for use cases such as UPI and lending, and automates testing with request and response configuration for APIs.
With an increasing number of applications operating on cloud platforms using ‘as-a-service business models, ensuring APIs’ smooth and secure functioning has become crucial and will continue to grow in importance in the future.
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