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A defined interface through which software requests data or functions from another system.
The requesting application sends an agreed message to an interface the provider exposes. A web API commonly accepts a network request and returns structured data or an error. Authentication, permissions, usage limits and versioned formats determine what the caller can do. An API can expose only a selected function; access to it does not imply access to all of a company's data.
Imagine a shop's software requesting a currency quote from a hypothetical rate service. The response specifies J$150 per US$1, a timestamp and the quote direction. The shop multiplies a US$100 price by 150 to obtain J$15,000 before other charges. If the service instead returns an error or an old timestamp, the app needs a policy for refusing or clearly labelling the conversion. A response that arrives successfully can still contain unsuitable data.