Protecting access to cash in the evolving banking landscape

Today, there are significant opportunities for financial institutions (FIs) to evolve and adopt new technology to expand their reach and create streamlined methods to deliver services more broadly.

Despite the growth of digital that was significantly accelerated by the COVID-19 pandemic, cash remains the most popular form of payment for day-to-day transactions, person-to-person payments and remains a key element for any savings and liquidity strategy. That combination has transformed how consumers bank and how financial institutions approach their channel strategy: digital, branch, network and beyond.

Transforming and automating the day-to-day transactions to allow other consultancy and advisory services in the branch is a first step most FIs have taken. Providing extended and more flexible access to cash should be a parallel strategy, which includes developing a cash services plan that meets both
the newer (tech-nomad) and the more classic (and vulnerable) customer demand for cash, in an easy and cost-effective way.

This is leading FIs to reevaluate their channel, network and cash strategies, to ensure that they are optimizing access, experience and cost—including their ATM network strategy and cost—balancing how to meet and expand customer demand with budgetary and strategic priorities. It’s imperative to review the entire channel process, finding new ways to improve efficiency, reduce costs and deliver an enhanced experience though more agile business models.

Across all operational areas, FIs are reviewing their processes, expenses and suppliers to find new ways to improve efficiency and reduce costs to deliver a more agile and profitable business.

Expanding access to cash
FIs pride themselves on ensuring customers have easy access to their services. However, how they own, run and operate this provision is under review, as FIs look to shift away from owning and managing the self-service channel in-house and seek core and strategic partners that can enhance and improve their financial services delivery.

As a result, we are seeing ATM as a Service resonating with institutions across the globe, regardless of size or market, as it enables them to shift the day-to-day network management to experienced partners who help them run and expand their network operation. And, in many cases, FIs are looking to transform their ATM channel entirely, outsourcing the operation and the entire network, looking for flexible commercial agreements that provide them with best-in-class edge services.

For those either stepping away from the ownership and/or operation of their ATM channel or just looking to extend ATM access for customers, there’s an increase in demand for retail ATM network access, which enables FIs’ customers to access their cash and other services in more convenient locations. There’s also the opportunity for FIs to brand these ATMs, enabling them to keep that important brand presence and customer connection.

Enhancing the customer experience
Providing exceptional customer experiences is another key pillar in FIs’ strategies today. As consumers increasingly rely on self-service to meet their day-to-day banking needs, having the right technology in place is vital. But we’ve seen technology take leaps and bounds in the last 25 years and consumer adoption of new technologies gets faster as well. That means FIs are looking for more flexibility in the investments they make, so that they can adapt to changing market and consumer forces and add or remove services or upgrade rather than replace.

For instance, some FIs are purchasing ATMs which have the capabilities to be upgraded to an Interactive Teller Machine (ITM). This is FIs futureproofing their investment with the option to add remote teller support at a later date—to either extend the self- service transaction set with the ability to have tellers provide authentication where needed or indeed offer consistent access to tellers at a time when labor is difficult to find. What’s more, rather than limit customer access through reduced branch hours, FIs can turn that completely on its head and even extend branch hours with the same or less resources.

Meeting evolving customer needs
Customers are also wanting to do more than just cash-related transactions at the ATM. In the US, the uptake in Crypto means customers want to be able to buy, transfer and manage these funds at the ATM. Across the Middle East, instant card issuance is a growing trend—with FIs enabling customers to open an account and receive their card at the same time, or replace a lost card, at the ATM. Across the globe, governments are linking up with FIs to utilize self- service technology to provide access to subsidies.

Trends around the world in the type of transactions and services consumers want to access their FI’s self-service channels differ. What’s clear is there is high demand for self-service, consumers want modern and adaptable technology with digital-first exceptional experiences. Financial Institutions need to increasingly think outside the norm to be able to meet these consumer expectations, while also fulfilling their own requirements for greater efficiency and cost-effectiveness.

Innovation is a crucial part of today’s self-service banking. New technology is not only removing obstacles but transforming the customer experience with a multitude of services, along with broader financial access to society.