Published October 6, 2020
Since launching in 1967, the ATM has become the most common way for banking customers to access cash wherever they are in the world. And, in the early 2000s, ATMs hit their boom years and that’s when they really began to evolve. So, over the last 15 years, the ATM has gone from merely providing cash to facilitating most consumer banking transactions. Now, with 3.2 million ATMs across the globe, the ATM can be a branch in a box—providing access to a full spectrum of financial services.
In the early 2000s, dual withdrawal and deposit ATMs were launched enabling banking customers to take money out as well as deposit cash and checks. This added significant flexibility enabling banks to perform even more transactions from teller to ATM. This evolution has continued and today 95 percent of transactions can be completed at the ATM—from simple cash withdrawals and balance checks, to more complex transactions like opening an account and applying for a debit card.
So, with ATMs taking cash in, cash recycling was the logical next development in ATM functionality. By enabling cash deposited into the ATM to be recycled for withdrawal, financial institutions have significantly improved efficiencies in their cash management processes by reducing fulfilment needs. For example, Greece’s Attica Bank deployed new self-service technology so they could easily manage higher transactions and high-volume cash deposits at the ATM.
Today, cash recycling is the largest growing ATM segment globally according to RBR, with the number of recycling ATMs predicted to rise by 25 percent over the next five years. This is largely due to financial institutions across the world hoping to use the technology to leverage operational efficiency across their estates. RBR’s Sam Blackwell, who led the study, said: “Recycling ATMs play a key role in many banks’ transformation projects by improving customer experience and cutting operational costs. Whereas previously some deployers were dissuaded by a perceived lack of reliability, or issues regarding integration or security, these concerns have now largely been assuaged.”
ATM software developments allowed customers to complete more and more of their banking needs via self-service. But financial institutions needed to do more than provide automation, they needed to provide support and assistance when their customers had questions or needed help authenticating documents and IDs.
The solution was found in the Interactive Teller Machine (ITM). Launched in 2012, the ITM uses a two-way video link via a call center to provide face-to-face teller support to customers completing their transactions at the self-service channel. The ITM is utilized widely across the US, Canada and in the Middle East region. It is a great choice for both on and off-site locations where 24/7 banking services are available including ATM drive throughs so banking customers can complete 95 percent of their banking transactions without even needing to get out of their car.
As financial institutions looked to start their branch transformation projects, the ITM has delivered important benefits by enabling banking customers to use self-service, freeing tellers to concentrate on higher value services, consultancy and relationship building. Plus, within the branch ITM has reduced queues, sped up transaction times, improved teller efficiency while still providing that critical face to face connection for banking customers.
What’s more, during the recent pandemic, the ITM played a significant role for financial institutions looking to maintain face-to-face connection and helping their customers while closing branches or operating social distancing. Many financial institutions were able let their tellers work from home – check out how First Ontario Credit Union did just this.
The biggest influence on recent ATM design has been the smartphone; a device that has changed the face of consumer electronics and set society on a path to digital domination. Since its launch and staggering pace of adoption, the form and function of ATMs has been built to mimic the smartphone consumer experience and reflect that same intuitive user experience.
From touchscreens, finger pinch and zoom, mobile authentication, to pre-staging transactions on a mobile and digital banking integration, banking customers now enjoy a similar experience at the ATM that they have on their handheld devices. So, now they can have a seamless connection from banking on their phone to banking at the ATM.
Also, the smartphone has enabled banks to offer contactless banking, the first to do it was ANZ. The personal banking financial institution enabled a single card tap to initiate transactions, with banking customers entering their pin on the pin pad and proceeding with their transaction as normal.
What we’re seeing now is more financial institutions taking contactless to the next level, by enabling customers to use their mobile phone for authentication—removing the need to use the pin pad. And this contactless connection can go even further by using the financial institution’s banking app to pre-stage the entire transaction, with the ATM solely providing the cash after banking customers have tapped their smartphone on the contactless reader.
Contactless is certainly the wave of the future—particularly post COVID-19. There’s now 1.3million contactless enabled ATMs in the world and this number is fast on the rise. According to RBR’s Global ATM Market and Forecasts to 2025 study, the number of ATMs offering cardless cash withdrawals has increased with a rise of 26 percent in 2019 – 16 percent of which was the US alone, while the number of ATMs offering Near Field Card (NFC) readers rose by 86 percent globally.
Of course, this improved consumer experience couldn’t happen without improvements behind the scenes. The combination of hardware, software and services means that ATMs can offer all the functionality and user interface that banking customers want today, as well as ensuring a more streamlined operation that can more easily integrate into the wider banking ecosystem.
The rise of digital banking is also impacting ATM development. Banking customers now expect to have a seamless link to a transaction started on their device and completed at the ATM and to interact with a teller. Although financial systems are often siloed, making it difficult and costly to evolve, they will have no choice but to up-to-date their platforms to stay competitive.
NCR’s rounded approach—the combination of hardware, software and services—enables our SelfServ ATMs to connect to the wider banking enterprise, offering a connected experience across traditionally siloed channels while maintaining high availability. And with our latest offering, ATM-as-a-Service, we’re helping financial institutions manage their ATM channel inhouse, reducing complexity and saving costs.
We’re not stopping. The NCR SelfServ family will continue its evolution to meet changing market needs. Whether providing contactless banking and launching anti-microbial treatments to keep consumer’s safe, NCR is committed to continually evolving to make sure the ATM provides goes beyond just accessing cash, but provides easy, convenient, safe wider banking services now and long into the future.