Fragmented APIs and Toolchain Headaches

In their early stages, FinTech teams often utilize a patchwork of tools and quick fixes to speed up development. One team might spin up an API using a specific framework, another documents it manually, while a third team uses a different gateway or testing tool.

Over time, this ad-hoc approach leads to API sprawl – an explosion in the number of services and endpoints that becomes increasingly difficult to manage (Why US-Based Fintech Relies on APIs | Nordic APIs |). Each new product or market expansion brings more APIs, more microservices, and often more duplicate or overlapping functionality. Without a unified strategy, FinTechs end up with dozens or hundreds of APIs spread across different departments and platforms.

The governance of these APIs often fragments in parallel. There may be no single source of truth or inventory of all APIs in use – a recent study noted that many financial institutions lack enterprise-wide visibility into their API ecosystems.

Some APIs slip through “shadow IT” channels, developed outside official processes, while others become “orphaned” or unowned over time. Standards for API design, security, and versioning might be defined on paper but are inconsistently enforced across teams. One group might enforce strict RESTful design and OAuth security, while another, perhaps under deadline pressure, exposes a quick JSON feed with minimal authentication. This inconsistency erodes overall API quality and increases the risk of mistakes.