Application programming interface (API) is a term used to describe a set of standardized definitions, routines, and software mechanisms. Using an API makes it possible to various types of programs.

1. How Using an API can Help Improve
your Payment Processes
Application programming interface (API) is a term used to describe a set of
standardized definitions, routines, and software mechanisms. Using an API makes it
possible to various types of programs.
The development of API technology makes it significantly easier to create new
computer programs. It also makes it possible to reconcile new programs with older
programs. In the past, synchronizing these programs would often require programmers
to start from scratch. Today, the development of API makes the entire development
process much more straightforward.
Since their recent introduction, APIs have been applied in a wide variety of different
ways. Businesses of all kinds have found that using API technology makes it possible to
integrate otherwise non-compatible programming components. If your business were to
restructure its payment processing, for example, it would need to establish clear
methods of communication between software. Without API, creating this sort of
synchronization would take significantly more time.
In this article, we will discuss the most important things for you to know about API. We
will also discuss how many of today’s top payment processing firms use API technology
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2. to satisfy their customer’s needs. By taking the time to understand this technology and
its myriad uses, you will see why API is considered so valuable to businesses.
What is API?
According to TechTerms, an application programming interface is “a set of commands,
functions, protocols, and objects that programmers can use to create software with an
external system.” In other words, an API helps create a unified system that helps coders
save time and not have to start each additional application from scratch.
API makes it possible to create code more efficiently, due to the creation of a common
starting point and common communication protocols. This is especially useful for
businesses that are making major changes, such as restructuring their payment
processing or reorganizing databases. Businesses that have been operating for multiple
years will already have back office systems firmly in place. API establishes a common
ground that makes it easier to transition to a more efficient system.
What are the advantages of API technology?
As you can already tell, using API technology has many distinct advantages.
● Ease of transitioning and developing new systems
● Universal protocols that make it easier to adapt or develop new code
● The ability to save time, through the use of uniform protocols
● More efficient use of computer space
● Improved communications and exchanges with other parties (businesses, clients,
vendors, etc.)
Once your business transitions to using API supported systems, it will finally be “caught
up” and will not need to make any future transitions. If it is using an API for something
such as payment processing, for example, using a standard XML format will help make
it easier to unify multiple different payment systems. For example, if one system uses
the code “enter.payment” and another system uses the code “payment.entry”, an API
can will reconcile these codes and make it possible for your business to move forward.
What are the different uses of API?
As you would probably expect, there are many different possible uses of API. In fact,
this technology has been applied to almost every dimension of the business world. As
time goes on, the collective use of API will continue to increase.
Some of the possible uses of API include:
● Developing uniform payment processing systems

3. ● Media and social media analytic tools
● Graphics and brand management—organizing logos and using logos in multiple
different spaces
● Cloud-based communications portals (such as the recently public ‘Slack’)
● Revolutionary app building platforms (ranging from mobile apps to desktop apps
to everything in between)
● Organization communication databases with multiple different inputs
● Various educational, scientific, and research-intensive programs
Essentially, anytime there is need for standardized protocols, there will be a possible
use for API technology. This technology is especially useful for businesses that are
trying to redevelop their infrastructure and make other transitions.
How do payment processing companies leverage API technology?
As suggested, one of the areas of the business that has benefitted the most from API
technology has been the payment processing industry. This is largely due to the fact
that, until recently, many companies were using outdated or non-uniform payment
processing programs. API was introduced to reconcile these inconsistencies and also
make it easier for businesses (such as the core business and a payment processor) to
communicate with one another.
There are quite a few different ways that payment processing companies take
advantage of API technology:
● Clearly identifying the status of each pending payment—pending release,
released, processing, sent out, posted, returned, cancelled, reissued, etc.
● Further identify the statuses of related documents (using a uniform status ID-
status name format)
● Clarifying postage codes (USPS First Class, Two Day Courier, Certified Mail,
etc.)
● Automatic corrections and various error handling mechanisms
● Synchronizing the payment processing platform with the company’s bank
accounts
● Proofing checks for accuracy and validity
● Tracking, managing, customizing, and modifying all types of payments
API makes it possible for businesses to benefit from pre-existing infrastructure, while
also still maintaining control over the general payment process. Generally speaking, the
best payment processing companies will allow their clients to have as much or as little
input into the process as they desire. Companies with developed IT departments may
want to handle much of this process on their own. On the other hand, small businesses

4. with little IT experience may want the payment processing company to manage the
entire thing.
Why is it important to choose an API-friendly payment processing company?
In the modern era, implementing new technologies is one of the surest ways for a
business to establish a competitive advantage. Payment processing companies that
have introduced a uniform set of protocols (such as API) make it possible for your
company to operate more efficiently and maintain this level of efficiency over time.
API puts your business in a position to succeed not just in the status quo, but also for
many years to come. Even if protocols and technologies dramatically change over the
next few years, having pre-existing API infrastructure will allow your business to
continue operating smoothly.
If you are unsure whether API-supported payment processing system is right for your
business, consider speaking directly to your payment processor. They will be able to
help you further understand these benefits and determine if making a change is the right
decision.
Conclusion
The development of application programming interface (API) has changed the business
world for the better. By having a uniform set of communication protocols, businesses
can operate more efficiently and continue to make productive changes. If your business
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5. has not yet made the switch to using API technology, then you may very well be falling
behind your competitors.