Factors influencing the adoption of external web API’s: an examination of the uptake of external web API’s by Absa Bank (a case study of Absa Bank South Africa).

Abstract

Web Application Programming Interfaces (APIs) are enablers for many future technology concepts that enable interoperability and platform independence (such as the concepts of “open data” and “open Banking” and strategies such as Service Oriented Enterprise Architecture (SOEA)). Some of these concepts have been in existence for over a decade but the increase in the adoption of external Web API’s has become the driving force behind the growth and acceptance of the concepts of interoperability and compatibility of technology in the Banking industry. The ultimate beneficiary of this objective to enable open collaboration between technologies in the Banking sector, is the customer. The significance of external Web APIs cannot be emphasized enough for businesses that seek to remain relevant and competitive through digital strategies. However, information systems literature on the adoption of external Web APIs by financial institutions bears testimony to a low rate of adoption. In order to address this situation, the primary objective of the current study is to establish reasons for the low rate of adoption of external Web APIs in a South African context. A case study approach is adopted so that an in-depth analysis of issues underpinning the adoption of external Web APIs can be ascertained. Absa Bank of South Africa is used to conduct the study. The choice of Absa Bank as the focus of the case study is one of convenience and purposiveness. From a convenience perspective, the researcher’s engagement with external Web API technology as an employee of Absa Bank provided an opportunity for in-depth, meaningful interaction with crucial components of the technology. From a purposive perspective, Absa Bank have made a commitment to the use of external Web APIs in order to enable collaboration with its Banking partners. A mixed methods approach is adopted for the study. The conceptual framework adopted for the study is centred on Roger’s Diffusion of Innovation (DOI) theory and the additional constructs of trust and security, both of which are pivotal to technology related influences in the Banking sector. The study’s corpus data is collected through interviews and questionnaires in order to answer the following main research questions:  What is the influence of the attributes of external Web APIs on the level of adoption at Absa Bank?  What is the influence of perceived trust of external Web APIs on the level of adoption at Absa Bank?  What is the influence of perceived security of external Web APIs on the level of adoption at Absa Bank? The first research question alludes to the attributes of a technology based intervention that influences the adoption of that intervention as propped in Rogers (2010) Diffusion of Innovation theory. A significant outcome of the study is that the DOI attributes have a positive influence on the adoption of external Web APIs. However, the technology itself needs to be adjusted to accommodate concerns of security and trust in order to enhance its adoption in the Banking sector.