Day in and day out, your financial institution makes a series of business investments. Your customers/members and employees do the same, whether in the form of time and effort or hard-earned dollars. It's all a very synergistic, give and take relationship.
But when it comes to cash and how it's used by your employees and account holders, it may seem like there's a whole lot more "give" than there is "take." Whether it's bank notes from ATM terminals or cashing checks with tellers and/or ITMs, customers are doing more in the way of cash withdrawing than actual depositing.
Thus, you may wonder if investing in a cash recycler which both dispenses and accepts cash — at roughly the same rate —makes sense. Since so many payment options are now available to consumers, does cash management technology pay out for banks and credit unions?
If you're doubtful about whether investing in a cash recycler makes sense for your facility, the following facts just might lead you to change your mind. Here are a few common misperceptions about cash and where the truth actually lies:
Perception No. 1: Customers rarely if ever go to ATMs for depositing purposes.
Reality: ATM cash deposits have risen significantly in recent years.
While ATMs perform a variety of functions these days beyond simple withdrawal and depositing, their main purpose is cash dispensing. That's pretty much always been the case since ATMs first made their appearance over a half century ago.
"Since 2012, cash deposits nationwide have jumped 22%."
However, data shows that more customers are, in fact, bringing money with them to ATMs than taking from them. Indeed, since 2012, cash deposits nationwide have jumped 22%, according to a webinar available through ATM Marketplace. Over the same period, check deposits and cash dispensing has diminished, by 35% and 20%, respectively.
2020 was quite the year for deposit activity. In April of last year alone, deposits to banks in the U.S. totaled $865 billion, CNBC reported from Federal Deposit Insurance Corporation data. Not only does that smash a monthly record, the previous one factored in all 12 months.
Thus, if ATM users are leveraging the terminals for depositing and withdrawing, it's reasonable to conclude that they would do the same for cash recyclers.
Perception No. 2: Customers prefer larger bills to smaller ones.
Reality: Customers enjoy a variety of denominations.
There's a reason why most ATMs dispense $20 bills as opposed to $1s, $5, $10 or even $50s; they're the most widely used dollar when it comes to spending, according to research from the Federal Reserve Bank of San Francisco.
But when it comes to withdrawing money from ATMs, most users say they prefer having more than the $20 option. In a national poll of ATM users conducted by Forrester (discussed in the aforementioned webinar), a majority of respondents in the South (54%), Northeast (53%), West (57%) and Midwest (55%) all said they would like to pick their desired denomination, be it higher or lower than $20. Just 10%, 11%, 9%, respectively, were fine with one.
This is another check in the cash recycler win column; cash recyclers are multi denominational. Over 30% of the dollar bills in circulation are $1, based on data from the Federal Reserve Bank of San Francisco. However, when it comes to the bank notes customers would most prefer to see, 60% of respondents said $10s and 53% said $5s, according to Forrester's poll.
Perception No. 3: Cash recycling is not widely adopted.
Reality: Cash recycling technology is on the rise.
With more banks consolidating by strategically closing certain locations in response to consumers' increased usage of remote banking, equipment requirements are adjusted. Stand-alone cash recyclers are an exception to equipment contraction given their ability to support efficiencies in the branch and at the drive-thru. Furthermore, FIs are investing in multipurpose terminals that combine technologies and functionalities.
"Approximately 24% of installed ATMs have cash recycling capabilities."
In fact, of the over 3 million ATMs that are currently installed worldwide, approximately 24% of them now have cash recycling capabilities, according to estimates from RBR. That's the equivalent of 775,000 units and an increase of 76% since 2013.
It's time to doubt your doubts about cash usage. Many factors augur in favor of doubling down on cash management, handling and the technologies that heighten efficiencies for your customers and employees. BranchServ Convergint offers several cash recycling solutions that can serve your facility and your customers' needs. From cash recyclers from Hyosung and ATEC to cash recycling ATMs from Hyosung, our cash recyclers can help you build and invest in a better bank. Contact us today to learn more.