The banking and financial services sector is undergoing a technological revolution through open banking, transforming the traditional approach to more convenient activities. This movement allows banks to enhance customer experiences by integrating services and products from various third parties, thereby expanding their capabilities in delivering a more comprehensive range of services.
According to Custom Market Insight, the global API banking market size is anticipated to increase from 3.5 billion in 2022 to 17.5 billion by 2032, at a CAGR of roughly 23% during the forecast period. What frightens the API future is that the rise in open banking trends requires enterprises to prioritize API testing. Although integrating more APIs can be straightforward, the addition of just one additional API can substantially elevate the complexity of test cases. This heightened complexity is necessary to ensure accurate validation of the ever-evolving UI and data layers within a multistep API flow.
In this article, we delve into the implications of open banking API testing and analyze the best strategies to leverage secure, cloud-based API tests to address the unique challenges that businesses often encounter.
The term “Open banking” involves the sharing of financial information and data between banks and third-party financial service providers. It enables customers to share their financial data securely with authorized third-party providers through the use of open, publicly available APIs (Application Programming Interfaces). By providing users more choice and control over their financial information and services, open banking seeks to improve the overall customer experience.
Open banking brings advantages that extend beyond consumers. Financial institutions can utilize open banking to tap into a wider array of financial products and services, facilitating business growth and enhancing competitiveness in the market. Through the integration of third-party products and services, financial institutions can harness consumer data to innovate and develop new products and services.
API testing holds paramount importance in the context of open banking, and here are why:
SPER Market Research predicts that the Global API Testing Market will reach USD 6.98 billion by 2032 with a CAGR of 20.62%. This demonstrates that API testing is extensively embraced by enterprises across various sectors, notably within the banking industry. Some advantages of API testing include:
Read more: Mastering API Testing: Your Essential Checklist
In open banking, several different forms of data can be retrieved through an interface. This encompasses information about the customer, deposit, loan details, transaction information, and real-time batch process information. Therefore, a vast amount of random data should be input into the system to investigate if there are any forced crashes or negative behaviors.
Load testing is essential in identifying the limitations of a banking system under realistic loads. Additionally, it contributes to maximizing resource utilization while guaranteeing open banking's reliability, scalability, and consistent performance. Considering aspects like response time, scalability, downtime, and infrastructure expenses, load testing monitors the system's performance at both normal and peak conditions.
Load testing encompasses several scenarios:
Authentication and authorization play pivotal roles within banking APIs. Testers must ensure rigorous multi-factor authentication is conducted before permitting APIs to execute designated functions.
Moreover, security testing also comprises further steps like validation of encryption methodologies and evaluation of the API access control design. It also entails managing user rights and validating authorization.
Katalon Studio is an integrated environment developed for test automation. It provides a comprehensive set of features for various testing needs, including automated testing of APIs, web applications, mobile apps, and desktop applications. It offers a user-friendly interface and enables testers with different levels of expertise to create and execute automated tests efficiently.
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Rest-Assured is a Java-based library used for testing RESTful APIs. This library simplifies the validation of HTTP responses, allowing testers to create robust and comprehensive API tests by supporting various HTTP methods and assertions.
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Apigee serves as a versatile cross-cloud API testing tool that empowers users to assess and evaluate API performance and facilitate API construction and support while also ensuring compliance with security standards such as PCI, HIPAA, SOC2, and PII for applications.
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JMeter is a powerful tool primarily used for load testing and performance testing of APIs. It allows users to simulate various user scenarios, generate heavy loads, and measure an API's performance under different conditions.
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Postman is a widely used collaboration platform for API development. Originally a Chrome browser plugin, this tool is extended to an on-premise solution for both Mac and Windows.
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API testing has become a pivotal element in open banking, driven by the continual efforts of financial institutions to enhance customer services and security. With the expanding realm of open banking and its offerings, API testing emerges as an indispensable practice. As a result, third-party providers may perceive API testing as an ongoing necessity rather than a singular undertaking.
To assist banks and fintech companies in executing API testing seamlessly, KMS Solutions' enterprise testing team offers comprehensive expertise and tailored solutions. With a dedicated focus on the unique requirements of financial institutions, KMS Solutions delivers strategies and frameworks that facilitate robust API testing, empowering these organizations to navigate the evolving landscape of open banking confidently.
Contact us for a comprehensive API testing strategy in open banking!