Amid the upheaval caused by COVID-19, people have come to realize the true meaning of not knowing what you've got 'til it's gone. Many of the activities people do every day were taken away due to lockdown and social distancing restrictions. Some continue to be unavailable to this day, more than six months removed from the pandemic's unwanted arrival.
Yet one place that most have been able to access throughout this ordeal are ATMs. Whether located in drive-up locations or vestibules, these ubiquitous terminals have served as a saving grace for FIs to satisfy their customers' banking needs without compromising their physical well-being. ATMs represent a rare legacy technology well-suited for these challenging times, allowing banks to maintain high levels of service while limiting potential exposure to COVID-19. Critically, the old stalwart of FIs is now becoming a key operational pivot point as in-branch traffic slows and changes in response to the pandemic.
Maximizing efficiency, reducing risk
As reported by Salt Lake City, Utah, news network KSL-TV, given the state-of-the-art technologies that ATMs and ITMs possess, many FIs have doubled down on upgrading their ATM terminals, given their lighter footprint and diverse capabilities such as bill pay and mobile-device pairing for smartphones and tablets. Because they're designed to maximize efficiency and speedy transactions, they enable customers to touch and go, reducing the risk of community spread.
Mary Wisniewski, a banking analyst for the website Bankrate.com, told KSL.com that mobile banking is more common than ever and the activities conducted on handheld devices they can also do from ATMs, in effect picking up right where they left off.
"You can use your mobile phone to pre-stage transactions at the ATM, so you don't have to use your debit card," Wisniewski explained. She went on to note that while mobile banking unsurprisingly intensified during the height of the pandemic, ultimately so too did ATM withdrawals and visits, picking up as local restrictions lifted.
After slight dip, ATMs back with a vengeance
Like Dunkin Donuts in the New England area or Waffle Houses across much of the South, ATMs are ubiquitous. Wherever there's a bank or branch, at least one ATM is found within it. Yet in 2018, ATM locations globally actually fell for the first time in their 50-plus year history, according to an RBR study reported by ATM Marketplace and several other online sources. In four of the world's five largest markets—those being Japan, Brazil, the U.S. and China – installations fell approximately 1% on a year-over-year basis. They improved in India, but the level of growth experienced slipped from the previous year.
"Biometrics can make ATM use even safer and more convenient."
But with social distancing measures and enhanced disinfecting still in place—and expected to continue for the foreseeable future—ATMs make personalized banking possible, albeit without the in-person assistance. The key for banks is to expand the capabilities of the humble ATM and future proof operations.
Leveraging new technologies to ride the wave
Even with the surge of ATM use, FIs are still faced with the basic challenge of service—namely, "Why should a customer use OUR ATM?" The answer, broadly, is advanced technology and innovative service features.
While it's still not widely available within all FI settings, biometrics help make ATMs safer and more convenient. This technology is in place in certain parts of the world on a trial basis, Wisniewski reiterated to KSL.com.
"If you look to other countries like Spain, there's a bank already piloting facial technology," she explained. "So that's how you'd be identified. You wouldn't have to touch the machine at all."
As we discussed earlier this year in a separate blog post, facial recognition software works by reading the contours and curvature of an individual's face as a substitute for cards or key input. Currently, it's being leveraged in a limited capacity among FIs, relegated primarily to employees and their access to certain restricted areas of a facility.
But as facial recognition technology continues to gain traction, it's only a matter of time before ATMs more uniformly incorporate its capabilities. This is particularly the case for Interactive Teller Machines, which allow customers to get more work done on their own. While more expensive than traditional ATMs, they're proving to be smart investments by helping smaller FIs compete.
"There have been video tellers at some of the smaller banks and credit unions," Wisniewski told KSL.com. "And you can interact with them at an ATM to do bigger tasks."
ITMs have proven to be lifelines, both for FIs that have deployed them as well as the busy consumers who have been able to use them after normal business hours. As Cambridge Savings Bank President and CEO Wayne Patenaude told American Banker, ITMs have given some of their Boston-based account holders more flexibility.
"It is a great way for customers to come in after work," Patenaude explained. "If they need something answered right away, we can make that happen… We think this kind of technology is the wave of the future."
Wisniewski agrees, telling KSL.com that ITMs reduce operating costs all while making more involved financial transactions possible. Notably, the more that ITMs can facilitate self-service, the better. Even after-hours can be managed with appropriate placement in vestibules or drive-ups. This drives operating costs down even further. And as always, core integration is critical to optimizing real time efficiency and expanded transaction sets.
Like a fine wine, ATMs are getting better with age and Americans are turning to them both for familiarity and convenience. BranchServ is here to help you with all your digital transformation needs, resulting in enhanced efficiency and profitability for your FI. Contact us today to learn more.