Economy, Business And Markets

Iran’s 1st Open Banking API Launched

Iran’s 1st Open Banking API Launched
Iran’s 1st Open Banking API Launched

The privately-owned Ayandeh Bank, in a ceremony on Thursday, unveiled an open banking API portal called Finnotech, which is the first of its kind in Iran’s banking system.

Finnotech aims to provide developers with an opportunity to offer customized banking services based on their users’ needs.

The portal is also to give access to banking platforms to “anyone who thinks can solve a problem or benefit others”.

API, or application programming interface, is a technology protocol that allows diverse software components to communicate. More to the point, it allows even non-experts to develop applications that make use of whatever software components a given API taps into.

Abdolreza Sharifi, Ayandeh’s deputy for electronic banking services, believes that open banking is inevitable today, therefore the bank decided to take the lead and open the banks’ doors to innovative technologies.

“Finnotech currently offers 12 services that allow users make payments or transact money without requiring advanced technical knowledge, in a totally safe environment,” Hamed Qannadpour, CEO of eFarda e-Commerce Company, was quoted as saying by on Thursday.

Hossein Mokhtarian, marketing director at eFarda, also noted that developers need to have a platform for the identification of users and the possibility of managing channels to start using the API service.

Stressing that even banks can use Finnotech’ services, Mokhtarian added that developers will be provided with a detailed documentation and technical advisory for using the portal.

Farzad Rahmani, founder of Chargon, also elaborated on how his startup is making use of API portal for offering efficient financial services to customers.

The startup has specialized in office management services.

“Now we allow large companies to make direct payments and have a more efficient supervision over their accounts,” he said.

Bahamta, a payment gate, Mehrabane, a crowdfunding app, and Cinema Ticket are other notable startups using Finnotech services.

 CBI’s Stance

Ali Kermanshah, the Central Bank of Iran’s deputy for innovative technologies, welcomed the move and said the source of innovation has changed from the supply side to the demand side.

“Now it’s the customer who is seeking innovative services,” he said.

 Aboutaleb Najafi, director of Informatics Services Corporation, also called on innovators to focus on the development of innovative business models, as “it is the only way startups can be successful in competition with banks”.

“Unfortunately, we use regulation to suppress innovations since we are not capable of dealing with them,” he added.

ISC, affiliated with CBI, is the leading developer of financial solutions in Iran. Almost all the platforms used in Iran’s banking sector are developed by the company, including Shetab, the nationwide interbank network.

In another development, the CBI announced on Thursday that it has expanded its supervision on electronic services offered by banks.

The CBI called on bankers to be cautious about using innovative technologies and asked them to ensure that these technologies are fully compatible with the regulations, especially in terms of remaining secure from money-laundering activities.

“Those who fail to meet the requirements will be legally prosecuted and subsequently be blacklisted by the CBI,” which means they will never be able to collaborate with banks,” CBI’s statement reads.

The central banker is expected to authorize the operation of fintech companies in the near future.

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