What Is an API: Definition, Principles of Operation, and Use in Business

What Is an API in Simple Terms?

API stands for Application Programming Interface – a set of rules and protocols that allows one application to interact with another, or to integrate its features into a website or operating system.

In essence, an API is a protocol for exchanging requests and responses, enabling the functions of one program to be embedded into another.

In this context, an application refers to any program that performs a specific task — for example, a video player, a messenger, or a CRM system.
An interface means the external layer of a program that allows other systems to use its features without accessing its internal workings.

This way, users don’t need to be programmers to operate a smartphone or task manager, and developers can easily connect systems via API by simply inserting a ready-made command from the documentation into a website – without studying source code or writing one from scratch.

In this sense, an API works much like a set of buttons on your computer screen: when you click one, it performs a complex operation – except in the case of an API, the “button” is a short text-based request.

How Do APIs Work?

APIs operate through interaction between a client and a server.

The program that sends a request to perform an operation acts as the client.
The API forwards this request to the server, which executes the operation and sends the result back to the client.
If the request is incorrect, the API returns an error response.

You can imagine an API as a short dialogue:

Server: “We’re a messaging service on this website.”

Client: “Great! I’m a website – I’d like to place an order.”

API: “Here’s the menu – what would you like to order?”

Client: “One chat feature for customer communication, please.”

API: “Server, please create one chat.”

Server: “No problem, here it is.”

API: “Client, your chat is ready. Adding it to your features.”

Every API has detailed documentation created by the developers, describing available functions and the steps required to connect them.
An API may be free and public or commercial, accessible only through paid service integration.

Once access is obtained, the provider’s code must be embedded into the client’s website or application. After that, the client program can use the server’s functions as part of its own system.

Why Do We Need APIs?

APIs benefit both developers and businesses, expanding capabilities and reducing costs.

Developers use APIs to:

• Accelerate product development by embedding ready-made tools instead of building everything from scratch.
  
• Reduce software costs, since even paid APIs are often cheaper than developing equivalent features independently.
  
• Simplify integration
• with external systems such as payment or navigation services.
  
• Improve security by isolating sensitive operations into separate protected components.
  

Businesses use APIs to:

• Automate data collection and processing.
  For example, a voice bot can collect order details over the phone and automatically upload them to a CRM system.
  
• Enhance customer experience.
  Many users prefer logging in with their social media accounts rather than filling out registration forms.
  

Sell products and services through online payments.
Since banking applications are developed by entire teams of cybersecurity experts, it’s often safer and more efficient to use a ready-made payment API rather than creating a new payment system from scratch.