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What the future of self-service will look like
This presents both challenges and opportunities to the financial services industry. Given the fast pace of improvement in consumer technology, such as more capable smartphones, banks that don't work to keep up will be at risk of appearing stagnant and falling short of consumers’ rapidly changing expectations, resulting in customers going to more tech-savvy competitors.
But it also gives banks an excellent opportunity to refresh and update one of their most reliable and trusted technologies for delivering a strong service to customers - the ATM.
An ideal time for ATM renewal
The ATM has been around for a long time - in fact it's celebrating its 50th anniversary in 2017. But despite the huge steps forward that the tech world has seen in that time, it's consistently maintained its position as the number one channel for self-service and interactions with banks, even among enthusiastic smartphone users.
This reaffirms that the ATM is still one of the most valuable assets banks have when it comes to offering self-service solutions to their customers. In fact, it's estimated that the ATM channel is set for rapid growth over the next few years in order to meet these demands, with the global installed base expected to hit four million by 2021, up from 3.2 million in 2015.
But in order to be a channel truly fit for the coming years, ATM manufacturers and deployers can't just keep offering the same services they have done in the past. Instead, the next generation of ATMs will have to evolve, becoming not only an interactive touchpoint for consumers requiring secure, reliable access to cash, but also enabling transactions that benefit from assisted service, such as new account opening and loan applications. This will see them becoming akin to a ‘branch in a box’, even offering direct access to live tellers via video call centers.
This must all be carried out while providing an experience similar to the devices consumers use throughout the day, such as a tablet or smartphone. Solutions such as browser technology and large, multi-touch screens will be essential in achieving this.
Innovation to support evolving demands
ATM innovation can't take place in a vacuum. The industry will have to understand what technologies and functionality consumers now expect, and react accordingly. This doesn't just mean providing a smartphone or tablet-like experience on the ATM screen, but looking at issues such as convenience and accessibility that make each transaction a little bit faster or easier for consumers.
For example, contactless ATM technology is already here, though the pace of rollout has differed around the world. For instance, Barclays in the UK introduced this in November and ANZ in Australia has been using it since 2015, when it introduced the world’s first EMV-enabled contactless ATM. This doesn't just make the experience quicker - cutting transaction times by as much as 50 percent in some cases - but also improves security, as removing the need to physically insert a card into a machine or enter a PIN eliminates many skimming risks. Now we are beginning to see a natural evolution for the smartphone to replace the card when initiating contactless transactions.
Elsewhere, biometrics and accessibility features also offer great promise for the ATM market, again offering great convenience and security benefits. India's DCB Bank is set to enable biometric authentication via the Aadhaar ID system for cardless ATM transactions, while in the United Arab Emirates, Abu Dhabi Islamic Bank has rolled out voice-activated ATMs to assist visually impaired users.
As the branch evolves from being only a day-to-day transaction environment to a sales and service-focused environment, many transactional activities will shift to the ATM. This will demand that financial institutions continue to invest in self-service technology. Those that take the lead on this and incorporate the latest technology will therefore stand well-placed to offer the best self-service solutions to tomorrow's more discerning customers.