What is API? Learn all about this technology for your business

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After all, what is an API? In practice, it is a series of rules and protocols that allow software and digital systems to communicate with each other.

The systems and software used by companies need to be integrated via API with other solutions, so that the use of a certain technology can be enhanced.

Being open to complementary innovations that appear in the market is essential to absorb best practices and achieve good results.

What is API?

API (Application-Programming Interface , or Application Programming Interface) refers to the instructions, programming patterns and routines that work together to access an internet application.

From integration via API, it is possible for different software, machines and applications to understand new instructions, interpreting information and integrating with various platforms. Among the most common types of APIs are: REST, SOAP, XML-RPC and JSON-RPC.

With integration via API, it is possible to exchange information and make process automation easier. Some of the tasks that can be automated through systems integration are:

  • Feed spreadsheets with data;

  • Update customer information, such as your contact and payment method used;

  • Shoot emails;

  • Make accounting entries;

  • Issue invoices.

How did this technology come about?

The first time the term API appeared was in an article by Ira W. Cotton, published in 1968 and entitled “Data Structures and Techniques for Remote Computing ”.

That is, the APIs are much older than they appear to be.

In fact, they appeared even before the development and commercialization of personal computers (PCs), being used as libraries for OSs.

In this scenario, integration via APIs was applied to local systems, sending messages between different mainframes.

However, with technological evolution, and especially in the early 2000s, APIs went beyond local environments.

Just this year, some big companies released their APIs based on open web protocols, like eBay.

As a result, partner developers were able to integrate their own applications into one of the largest marketplaces in the world, enabling new business.

Today, the company has a large and active community of developers with several APIs, which are free and free to use.

Another major company that stood out in launching an API was Twitter, in September 2006.

In this case, it was a response to a movement by developers who were already creating unauthorized parallel applications.

However, Twitter saw the value in community involvement and opened its own.

What is API in the financial market?

Financial market companies often take advantage of APIs to connect to various exchanges and data providers, among other organizations useful for their purposes.

Think of the following scenario: a large bank that wants to expand its customer base, as well as offer new features to build loyalty to the existing base, knows that one way to do so is through investment services.

As its current infrastructure is limited, creating all investment mechanics within its interfaces (Internet Banking and app) would be too expensive.

Therefore, the bank can close with a third-party brokerage and link its services within its interfaces, through an API that connects the services.

Thus, with an API, it is possible to automatically access data such as the dollar variation in real time or execute trades, such as the purchase of shares in certain funds or on B3.

The API also allows financial companies to offer their own services to third-party developers.

For example, a stock app might use a broker's API to execute trades.

In this way, technology helps companies provide a better experience for their customers, as well as opening up new revenue streams.

What is an API for?

By understanding what an API is, it is easy to understand what it is for. Technology works like a waiter in a restaurant, who takes your order (request) and brings the dish (response) from the kitchen (database).

In this way, the API is used by developers to create applications, websites and services, as well as to access data from third-party applications and extend their range of functionality.

In practice, technology serves to define how software components should interact.

For example, if you are using a weather app on your Smartphone, the app will use an API to request data from a weather service.

Thus, the API defines how the data will be formatted and how the two applications will exchange information.

APIs are used to create modular, reusable code that can be shared across projects. They also help abstract away complexity, making it easier for developers to work with large codebases.

When used correctly, APIs can make development faster and more efficient.

How does an API work?

You've already learned what an API is and how this integration is a process of connecting two or more applications that allow these systems to share data.

There are different ways to perform the integration — which requires a deeper technical understanding.

For example, a simpler way to accomplish this process is with integration platforms, which help connect primarily SaaS applications and systems.

Returning to the example of e-commerce and credit operators, the APIs create a connection between the two systems so that data flows from one company to the other, so that payment can be streamlined.

In addition, there are processes known as “Connectors” (or Connector Applications), which serve to facilitate the transfer of data between large platforms and software.

And, of course, there are custom integrations, which respond to specific business needs, and often have code written from scratch. It tends to be more expensive.

The main advantages of an API

By understanding what an API is, it's easy to understand why technology is so important.

Thanks to the API, software development in general has become much easier and faster.

In this way, technology has made it possible to develop powerful applications that were not possible before, as well as work cross-platform — which can run on any operating system.

Furthermore, it is an innovation that is easy to learn and use thanks to its excellent documentation and community support.

Among other benefits, we can mention:

Optimized management

With the integration via API, developing, adapting and correcting problems related to platforms is much easier, since these tasks are automatically performed directly in the system.

The result is better use of managers and employees, who can be concerned with strategic demands and who require greater analytical power, leaving repetitive activities in charge of technology.

Data security and integrity

Integrated systems make data exchange and sharing secure.

In this connection, protected by layers of cryptography, the supply of information represents a lower risk to the integrity of the data, which can be considered a valuable asset for any organization.

In addition to ensuring security for the corporate database , there is control over groups of information that can be accessed through APIs, previously approved by the manager or person responsible for the area.

Clear communication

As we mentioned when explaining what an API is, its documentation is built from data coming from different sources, which are treated to improve its interpretation and application in concrete actions in the business.

Then, communication is standardized, regardless of the system that operates at the time.

Integrated systems guarantee assertive and collaborative strategies, combined with solutions developed by different sectors of the company and even by third parties. Everything with clarity and objectivity.

Cost reduction

Integration via API also reduces costs, since, primarily, the company does not need to worry about developing all the applications necessary for the operation of a project, as well as its functionalities.

By implementing already developed APIs, time is used in the best possible way, positively affecting aspects such as productivity and return on investment (ROI).

Increased customer loyalty

With APIs, the company has the opportunity to increase the level of innovation in its product or service. It's a way to engage the community in improving functions or adding new features.

As a result, the organization aligns more quickly with market needs — especially with Public APIs.

More productivity

As the demand for software continues to increase, companies are looking for quick ways to prototype and create new products.

With integration via API, companies have a differentiated mechanism to speed up development time. This way, developers can quickly implement functionality rather than building an entire new product from scratch.

By understanding what an API is, it is possible to take advantage of advanced and powerful technologies, integrating them into your own applications, as is the case with Google Maps that we mentioned earlier.

It's something that can save you a lot of development time and increase your company's productivity, allowing you to achieve business goals faster.

In fact, according to a report released by Globe Newswire , companies that leveraged APIs saw a significant increase in productivity of 59%.

Decrease in data volume

APIs can reduce the volume of data that a company handles, since the functionalities/integrations are developed by professionals or external companies, without the need for the organization that owns the API to get involved.

Access audit

With APIs, the company can have full control over software and hardware access permissions. Thus, it is simpler to audit the accesses, allowing your team to authorize or not the operation.





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