Stepping into the clouds: The evolution of ATMs

By : Alastair Hogben

August 22, 2016 12:00 PM

Cloud computing has experienced significant growth over the last decade with the technology helping businesses to reduce costs, increase efficiency and optimize scalability across their operations.


Gartner recently predicted that the global, public cloud services market would expand 16.5 percent this year to reach $204 billion in value. The organization said the technology’s popularity shows no sign of abating, particularly as companies continue to pursue digital strategies.


One area where financial institutions (FIs) are beginning to utilize the cloud more effectively is ATMs. According to the ATM Industry Association (ATMIA), ATMs are entering a new era of innovation and cloud computing is likely to play a big part in how FIs upgrade their legacy equipment.


Implementing cloud-capable ATMs can deliver substantial advantages for organizations. Let’s look at the current state of the market, what changes are likely to occur and how FIs can leverage new technologies.


Updating legacy technology


ATMs are approaching their 50th anniversary and the ATMIA expects the market to go from strength to strength over the coming years. The association predicts the number of installations will climb 37 percent by 2020.


Currently, most ATMs are self-contained computers that perform the majority of their tasks independently. In other words, they aren’t linked to a server that can send commands or provide software updates.


As a result, these ATMs rely on manual updates from a technician when changes are required. For organizations with a large fleet of machines, the process of updating legacy technology can therefore be a considerable undertaking.


The lack of a centralized network also means FIs don’t have real-time oversight across their machines, which can lead to increases in downtime when ATMs experience faults.


Benefits of cloud-capable ATMs


Organizations looking to revolutionize their ATM fleets can invest in innovative platforms, such as NCR’s Kalpana software, that enable machines to be operated remotely.


Rather than relying on legacy PC architecture, FIs can introduce thin-client ATMs that are easier to deploy and maintain. NCR figures reveal that banks can reduce the cost of running ATMs by approximately 40 percent, bringing savings of up to $800,000 for institutions with 100 machines in theirnetwork.


They also offer various security advantages, with traditional ATMs prone to cyber attacks due to easily accessible USB slots.


Criminals use physical attacks to reach the USB, which is often behind the fascia, where they can upload malware that compromises the ATM’s operating system. A European gang used this technique to empty bank machines in 2013.


Optimizing consumer experiences


The advantages of cloud-capable ATMs aren’t just isolated to FIs. Consumers also benefit from personalized experiences at the ATM, tailored for their profile and activity, and fewer machine breakdowns as well as more advanced features because organizations can quickly test and roll out new services.


As FIs develop their omni-channel strategies, having a better-integrated, more centralized network of ATMs will help businesses optimize self-service offerings.


Businesses worldwide are reaping the rewards from cloud computing, and as more FIs make the shift to cloud ATMs, they can expect to achieve significant cost reductions, improved oversight and great satisfaction among customers.



Alastair Hogben

Senior Marketing Manager, FS Software

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Alastair Hogben is a Senior Software Marketing Manager, responsible for the marketing of NCR's Financial Services enterprise software portfolio with a specific focus on CxBanking and enterprise-enabled applications.