JPMorgan's pulled a move from the Google playbook - and opened a new front in the battle for business on Wall Street
- JPMorgan has opened an application programming interface (API) store for clients.
- The API store was highlighted by JPMorgan chief Jamie Dimon in his annual letter to shareholders as part of a discussion of the bank's tech strategy.
- The move is the latest example of JPMorgan taking inspiration from Silicon Valley giants like Amazon and Google.
- It also puts JPMorgan's API store in competition with Marquee, Goldman Sachs' API store, opening a new front in the battle for business on Wall Street.
JPMorgan's taking a page from the Google playbook.
The US banking giant has created a JPMorgan Chase API (application programming interface) store, allowing clients to plug into JPMorgan's data. The API store was highlighted by JPMorgan chief Jamie Dimon in his annual letter to shareholders as part of a discussion of the bank's tech strategy. From the letter:
"Our shared technology infrastructure - our networks, data centers, and the public and private cloud - decreases costs, enhances efficiency and makes all our businesses more productive. In addition, this allows us to embrace the fact that every business and merchant has its own software and also wants easy, integrated access to our products and services. We are delivering on that through the creation of a common JPMorgan Chase API (application programming interface) store that allows customers to add simple, secure payments to their software."
APIs are the standard way for computer programs to "talk" to one another without human intervention. When you use your Facebook account to log in to Spotify, that's Spotify talking to the Facebook login API. Famously, Jeff Bezos mandated several years ago that the only way Amazon teams could integrate their products would be via API, in a bid to increase the efficiency and speed at which programmers can build new services.
The JPMorgan API store is known as JPMorgan Developer and has two different portals. JPMorgan Developer is focused on corporate and investment banking clients, and soft-launched in late 2017. That portal now has more than 100 users, the majority of which are asset management clients. More recently, the bank launched Chase Developer, which caters to those partnering with the bank's consumer-facing bank.
"API's give us an opportunity to break down our large programs into reusable components," Lori Beer, chief information officer for JPMorgan Chase, told Business Insider. "That also allows us to think differently about how we want to connect with our customers."
She said:
"If you think about J.P. Morgan Markets, that's a great asset we have. If a company wants to connect with us, it requires technology resources on our side and technology resources on their side to make it work. If they want to get information from us and be able to integrate that into their workflows, it's difficult. That's why an API strategy for us is important to simplify the way we interact with our clients."
Beer cited the example of a Treasury Services client that wants to send JPMorgan a payment through their SAP system, or a custody and fund services client that wants to use JPMorgan's reporting and analytics tools.
"Instead of them having to work with our IT department and their IT department, they can go into our API platform, see what's available, and pull those APIs," she said.
The creation of the JPMorgan Developer store follows Goldman Sachs' decision to build its own API store, called Marquee. Goldman Sachs' API strategy has been driven by Marty Chavez, who's now CFO of the bank, who once said that "Goldman is for risk what Google is for search."
Goldman recently hired Reinaldo Aguiar, a former senior software engineer at Google who focused on the tech giant's search ranking, to build out the bank's Marquee platform. Business Insider reported last year that the bank had posted at least 20 job ads relating to Marquee.
With JPMorgan and Goldman Sachs now promoting their own API stores, a new front is emerging in the battle for business on Wall Street, with banks putting data and analytics tools in the hands of clients.
"It simplifies the way we work with our clients, but longer-term, it could actually transform the way we think about a product," Beer said. "Again, the one thing that tech companies have traditionally done is leverage platforms. They've thought about how they deconstruct their core business capabilities, and that allows them to package them in a much different way."