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How Saxo Bank used open APIs to transform its business model and develop a ground-breaking trading platform

Tom Macaulay | Dec. 15, 2016
SaxoTraderGo - which was built on an open API - has transformed how the company does business.

API

The inherent transparency of open API may seem an uneasy fit for an industry as opaque as the banking sector, but this openness was one of the most compelling attractions of the interface for Saxo Bank's new trading platform.

Launched last year, SaxoTraderGo - which was built on an open API - has transformed how the company does business.

"We could take on third-party developers and company fostered [ones], and we could even take on third-parties to make completely separate custom apps," Saxo Bank CTO Michel Andr told Computerworld UK at the GOTO Accelerate Business Conference in November.

"We can make more applications; we can allow white-labels to seamlessly embed Saxo functionality into their own banking portals or trading portals."

An API is an application programming interface for developers that functions as a contract governing how different programmes can interact with a piece of software. Making APIs open gives developers free access to use them to build innovative applications, which is why they're also known as public APIs.

Benefits and use cases of open API

Saxo Bank is a global online investment bank that serves both direct clients and those of white-label partners, which use it as a trading service provider.

It serves around 50,000 users logged in at any point in time, and processes roughly 400,000 price updates per second, which require rapid reactions of sometimes sub-millisecond speeds. Transaction peaks can hit around 2,000 to 3,000 trades per second.

Online trading platforms have been central to the bank's operating model since it was founded it 1992.

"We brand this to other banks so they can take our platform in the cloud in a business as service manner," Andr said.

SaxoTraderGo platform is the latest incarnation of such a platform. It was launched in May 2015 with the aim of letting clients trade and invest anything at any time across any device. The open API that provides its foundation supports a rich application with chart creation capabilities and offers functionality across the trade cycle.

"Within a year it actually stands for 60 percent of our business," says Andr. "We haven't seen that quick uptake on any platform before."

Later that year, Saxo launched the open API to support a customised trading experience through access to its infrastructure. Enhanced interoperability was one the most appealing attractions of the strategy. Clients can be given permission to do simple trading or they can migrate everything into Saxo's platform.

Giving third-party developers access to Saxo's open API lets them create features and products when the bank doesn't have the time or resources. For example, clients can now rebalance portfolios in Excel through the open API in the same channel as the trading platform just by using a plug-in.

 

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