At Capital One, Open APIs Aren’t Really Open

Capital One Financial Corp. introduced its application programming interface, more commonly known as an API, to some tech-industry fanfare last October.

While an API is a protocol that allows software platforms to communicate with each other, Cap One’s APIs — there are four — are a heck of lot less open than most. In fact, they are not open at all.

Bank Innovation has learned that Capital One’s APIs, which are administered by the bank’s Capital One Labs unit, are “very limited” to “partners at this time that can help [Capital One] achieve our short-term strategic goals.” Those potential partners are only those ventures “in pretty specific verticals that have the scale to reach a large number of our customers.”

That’s a pretty small list, in our view — if there is even a list at all.

When Cap One introduced its APIs last fall, bank officials portrayed the APIs as open platforms for working with the bank. “We know we won’t always reach the customer where and when they’re shopping. But if you can, we should talk,” Capital One’s Paul Sun said at the time.

But only if you can “reach a large number of our customers,” apparently. Now, Capital One maintains that “as we continue to work with third-party partners, we plan to open up the platform to a wider audience,” but let’s be real here. A Facebook API this will never be.