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Create a payment experience that looks like the rest of your site using a payment API. APIs (application programming interface) enable the seamless integration of software to share data. With payments specifically, APIs have transformed how businesses and consumers move money.

Topics covered in this article:

What is a payment API?

A payment API (application programming interface) is an API that allows businesses to seamlessly manage transactions on their platform. The Dwolla API will connect your business to the U.S. banking infrastructure for sending, receiving or facilitating transfers from account to account.

Is a payment API the same as a payment gateway? A payment API is not the same as a payment gateway. The payment gateway validates the identity of the customer and packages the transaction securely before it gets sent to the payment processor. Transactions by payment gateway are also referred to as card-not-present.

Use Cases for a Payment API

Much like other API use cases, innovators are changing the world using payment APIs and account-to-account payment solutions. Common use cases include programming and automating sophisticated payment workflows.

  • Disbursements – Sending funds to your end users.
  • Receivables – Collecting funds from your end users.
  • Facilitating Payments – Enabling two users to transact on a platform.
  • Me to Me – Move money between accounts owned by a single user.

Additionally, businesses can use the flexibility of a bank transfer API to configure a solution to support a combination of these payment flows while using a variety of payment methods based on their needs.
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What is a White Label Payment API?

A white label payment API is an option that more businesses continue to build into their strategies as the volume of cardless, electronic and alternative payment transactions are drastically increasing.

Dwolla’s platform is designed to be API-driven and tailored to allow a business to add additional payment rails—like ACH and Real-Time Payments to their payment stack while maintaining their own branding and style. Instead of sending users to PayPal or another third-party payment gateway to complete a cardless transaction, a business can use a white label payment API to integrate new payment methods into an application or operation.

One of the primary benefits of “buying” versus “building” a payment solution is that you can get up and running in a fraction of the time.

With Dwolla’s technology, tailor a payment API to help your business navigate the ACH and RTP® networks without having to start from scratch. Integrating with a white label API is ideal for businesses looking to get their solution to market quickly without having to batch Nacha files!

Other advantages of integrating a white label payment API include:

  • Domain Expertise – Your payment services provider is immersed in the payments space that you are looking to enter, and you’ll be able to rely on them for solutions to the most commonly encountered challenges.
  • Reduced Development Expenses – Building from scratch requires time, talent and infrastructure, as well as a development roadmap. Integrating a rock-solid payment solution can take as little as 30 days!
  • Access the Financial System — A single payment API integration can access different payment networks and transfer speeds—without having to develop relationships with multiple financial institutions.

Before you start building in our sandbox testing environment, read through some questions about the implementation period for a payment API.
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What is an ACH Payment API?

An ACH Payment API enables developers to create software that facilitates payments, specifically account-to-account payments over the ACH network.

Companies may choose to leverage a payments API to facilitate card payments, and while this is a common option for consumers and businesses alike, the cost of processing these payments can be a significant detriment to profit margins, as well as user experience.

Credit card payments typically have a percentage-based fee on each transaction, ranging from 1.5% – 3.5% and historically have experienced a higher risk of charge-backs and/or decline rates.

By offering ACH payments through an API, businesses can not only automate high-volume transactions and scale their payment modalities, but reduce fees on payment processing and provide a more effective user experience.

For more information on how businesses may use an ACH API, read this article.
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What is a Real-Time Payments API?

The Clearing House’s RTP® network brings participating banks together in a common agreement to recognize each other’s transactions in real time.

Dwolla’s real-time payment API sends your payment instructions to our financial institution partners, who initiate funds transfers on the RTP® network.

Your interaction with the Dwolla API is consistent regardless of whether you are sending an ACH or RTP transaction, requiring only a small code change to let the API know that you want to send your transaction via RTP.

The RTP® network supports credit “push” transfers, whereas ACH supports credit push as well as debit pull transfers. RTP is particularly suited to support disbursement use cases. Whether your business is built around B2B, B2C or a combination, you can power your application with RTP.

While ACH Payments and Real-Time Payments are available via Dwolla’s API, there are some significant differences (in addition to what has been listed above).

For more details on Real-Time Payments, read this article.
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Business Benefits of a Payment Platform API

The ability to programmatically initiate bank transfers from account-to-account can be a driver of growth for organizations. With a bank transfer API, a business has more control over what the experience looks like.

Let’s highlight six specific benefits:

  • More affordable transactions compared to card payments or wire transfers.
  • Automated payments for recurring transactions or individual refunds, replacing manual processes.
  • Higher-confidence in payment confirmations (ACH returns are not credit card chargebacks).
  • Better insights into the status of a payment (build automation with near real-time webhook notifications).
  • Scalable technology that supports growth as volumes increase.
  • Matches the user experience of an existing business operation with existing payment processes.

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RESTful API Examples

A RESTful API is a style of API that uses HTTP requests to access and use data. This architectural style is more suitable for efficient internet usage and can be built using various programming languages. APIs allow different platforms to connect and share information to carry out specific tasks.

Dwolla gives you a modern RESTful API for account-to-account payments. The API incorporates hypermedia (links) which allows Dwolla’s business logic to stay out of your application. The flexibility and configurability is what makes it so appealing to businesses looking for account-to-account payments.
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An Introduction to the Dwolla API

What can a business expect in terms of an onboarding experience with a payment API?

This question has two different answers. If your business is onboarding another business to your platform, this documentation outlines the basics.

If you are asking about onboarding your business with the Dwolla API, we have resources for that, too. Here’s an integration roadmap to help you better understand the timeline of specifically implementing Dwolla’s API.

After you create a Dwolla account and you start integrating, use this resource for guidance on specific aspects of the API integration.

What types of customers can be created in the Dwolla API?

There are four different customer types that can be created in the Dwolla API. Verified Customers can be created for Personal and Business users, plus Unverified Customers and Receive Only users. The Dwolla Developer Portal includes documentation explaining the specific nuances of each customer type, from transaction limits to functionality.

How can I tell if the payment API provider is reputable?

We recommend looking at third-party review sites and customer case studies to learn how they have experienced value with a specific API provider. Additionally you can use this resource to help you better understand what to consider when choosing a payment service provider.
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Dwolla API Developer Documentation

  • API References – Implement a RESTful and reliable API to connect your business to the U.S. banking infrastructure.
  • Step-by-Step Guides – Step-by-step guides that walkthrough best practices of implementing Dwolla’s payment API.
  • Key Concepts – Fundamental building blocks of integrating with Dwolla’s technology.
  • Testing Environment – Start building in the sandbox for free. From creating customers to initiating transactions, get a feel for how our API works before going live in production.
  • Developer Support – Explore, discuss and ask questions about the Dwolla API.

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Additional API Resource

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