Rethinking The Role Of The ATM

ATMs have been around for decades, along with the challenges they pose for financial institutions – including security of a machine that can hold hundreds of thousands of dollars; the financial burden of operating a fleet of such complex machinery; and management of the suppliers, solutions and technologies that go into making an ATM tick.

As consumers continue to turn away from the FI branch in favor of less face-to-face, more self-service interactions, what role does the ATM play for these institutions to make their customers happy? And how can they embrace that role while managing the cumbersome upkeep of such a legacy piece of equipment?

In an upcoming webinar, Suzanne Galvin, SVP of product management for US Bank, will dive into these issues with Karen Webster. The webinar will explore how ATM managed services can not only address some of the administrative and financial burdens of operating a fleet of the machines, but can also help FIs keep pace with a new generation of customers who have different expectations for their experiences with financial service providers.

Ahead of the webinar, Galvin and Webster sat down to skim the surface of some of these topics. According to Galvin, exploring the purpose of the ATM in today’s financial services climate touches on a deeper issue at work.

“Other ways of connecting with financial institutions have dominated as of late,” she said. “Customers are more comfortable with online and mobile options in financial services. You have a demographic shift – you have younger customers who tend to rely on technologies, and they’re not being trafficked through your branches.”

For banks and credit unions, this means a massive hurdle in maintaining the profitability of their physical branch locations. ATMs remain an integral part of those branches and, today, can potentially act as a vessel to deliver new services to those younger customers. Maintaining an effective fleet of ATMs, though, is no easy feat.

“These devices are more sophisticated than ever before,” said Galvin of the ATM. “They’re a critical part of your overall retail strategy. But you not only have to understand the evolution of the technology of these devices, you also have to know how to work with vendors in a more sophisticated way, and understand and manage the investment you made in these devices.”

ATMs can cost upwards of $65,000 in some cases, the executive noted. And each of these machines comes with a set of regulatory, security and other PCI compliance requirements.

“FIs are increasingly worried about fraud,” said Galvin. “These are money boxes. They do a lot of different types of transactions, and you have hundreds of thousands of dollars sitting in these devices all over the place. The opportunity for security risk and fraud at the ATM is huge.”

Banks and credit unions have to invest a lot of money into keeping ATMs secure, the executive continued. Between investing in the ATM itself, to taking care of maintenance, compliance and security, owning and operating a fleet of these machines is undoubtedly a financial burden for FIs. According to recent research, financial institutions are spending as much as 35 percent of their operations budgets on managing ATMs alone.

According to Galvin, the answer to this financial pain point is often to outsource the management of ATMs – but not to just anybody.

“These are complex, sophisticated challenges for FIs, and it’s great when they can work with a bank-owned company that understands it all,” she said. “They have the wherewithal to understand how FIs operate and how they’re measured on customer experience. Taking that headache away, and having a tried-and-true organization deliver a positive customer experience through the ATM, is a big relief to FIs.”

Join our webinar on October 24, 2017 to hear from Suzanne Galvin, SVP of product management for US Bank, to learn how your institution can deploy ATM managed services to create a competitive operations advantage by improving customer engagement, ATM usage and convenience while simultaneously reducing operations expense.