The Empowered Role of the ATM in the Digital Era

When was the last time you used your mobile phone? An eye-opening study conducted by dscout last year found that we touch our phones, on average, 2,617 times each day – or 1.8 times per minute.

Let that sink in.

This was a small study – about 100 people, recruited as a demographically diverse sample of a pool of 100,000 Android users. Yet I’m betting we all use our phones more than we think we do. Digital natives are taking over – not just Millennials and Gen Z, but the rest of us, too. We’re all getting savvier with our mobile phones and technology in general, and our changing behaviors are driving big changes to the way companies interact with us.

At Diebold Nixdorf, our work sits at the crossroads of the physical and digital, and nowhere is that more tangible than at the self-service channel. Mobile use is up, branch visits are down, but around the world, nearly all of us still travel to an ATM to withdraw and deposit our cash. In the U.S., for example, TD Bank found more than 60% of its customers visit ATMs at least once a month. It’s a connection point between our digital financial lives, and our physical wallets – but how is it evolving with the times? What will its role become in a future that is increasingly digitalized?

Cash: Our Most Pervasive Payment Method
I meet with financial institutions around the world, and it’s fascinating how – even in places that are “going cashless” – people still have a propensity for physical currency. Just look at these stats from our new global cash infographic:

  • Cash usage is growing in nearly every region of the world.
  • Europeans rank cash highest in simplicity, speed and security.
  • Americans rank cash as the most secure payment method.
  • 85% of global transactions are conducted in cash.

But wait! What about millennials? A new study exploring millennial habits and attitudes found that 80% of their demographic uses cash, and 64% carry cash “most of the time.”

Holistically, with two billion people around the globe still unbanked, and $19 trillion in cash transactions conducted annually at small businesses, it’s a form of payment that nearly all of us still heavily rely on.

The real shift is not from physical cash to digital currency – it’s from fewer choices to more options.
What is really changing is natural human behavior. We see it in the new services that are being introduced by fintech companies, we see it in the shift to online banking and mobile. Transactions are evolving from traditional card-and-PIN to digital, cardless exchanges. FIs need to adapt, and this is where the role of the ATM becomes so interesting. It’s the point in the conversation when I start to use words like “innovative” and “omnichannel,” because the modern self-service terminal can be – and should be – a critical touchpoint for connecting more deeply with consumers.

As branch use declines and mobile use increases, the self-service channel becomes a more integral part of the equation. ATMs are trusted by consumers, they’re ubiquitous, and for on-us customers, they’re nearly always free. The ATM channel sits squarely at the crossroad between physical and digital, and new tools and capabilities are emerging that enable both consumers and FIs to do more at the self-service terminal than ever before.

New Roles, New Responsibilities
FIs must take critical steps now to ensure their customers have the access to cash they need, when they need it, wherever they are. Yet legacy infrastructure, engrained business philosophies and complex regulations work to stifle new ideas and new innovations. The self-service channel is a place where FIs can begin to introduce change in manageable steps:

  • Implement infrastructure step-changes that are flexible, scalable and adaptable.
  • Introduce new software that enables omnichannel experiences by connecting mobile app information with the bank’s core system in real time.
  • Shift components of the network’s service needs to a Managed Services partner to cut costs, drive efficiencies and enhance security.
  • Begin to enable advanced transactions and automation capabilities with intelligent deposit, cash recycling, cardless access and swappable cassettes.
  • Offer the capabilities customers crave – like denomination choice – and the convenience small-business owners desire – like direct funds crediting.
  • Create an experience more like the one consumers have with their smartphones – both from a UX and an enablement perspective.
  • Optimize and manage cash levels in the self-service and branch network through our holistic, tailored True Cash Cycle Management approach, which includes software, services and systems.

These are the consumer-centric experiences and solutions that will empower the ATM in the digital era, and today, we’re in the middle of this massive transition. It’s an exciting time to be in this business –rich with new opportunities to surprise and delight consumers.

Transaction automation and migration to the self-service channel are challenges that are still very much a work in progress at most financial institutions. In some areas, banks must still work on providing enough ATMs, in the right places, to meet consumer demands. And woven through everything is the need to optimize the cost of handling and managing all that cash at every stage of the journey.

Hidden Costs, Hidden Opportunities
To build the best self-service channel and the most engaging customer experiences, there must be a robust partnership between FIs and ATM providers. Your situation is unique, which means our solutions will work best when they’re tailored to your organizational strategy and priorities.

As a key partner to the financial industry for more than 150 years, we’ve built, tested and expanded our solution portfolio to meet and anticipate emerging trends in the marketplace. We understand the complex ecosystem of digital and physical cash, because it’s where we operate every single day in more than 130 countries around the globe.

One of the most engaging, interactive and fruitful sessions I conduct with FIs is focused on the automation journey. It’s an opportunity to dig deep into their current state situation and their future-state goals. Together, we discuss new methods of streamlining their cash cycle processes and explore how new hardware, software and service solutions could end up saving them money in the long run. There are usually some unexpected “aha!” moments – and that’s where the true work of innovating a 50-year-old channel for a brand new era can really begin.

Are you meeting your customers’ demands for easy access to their cash, when and how they want it? Start here to find out more about how to make those connections happen more seamlessly. Or, ask your question directly – we’re always on and ready to help solve your toughest dilemmas.