New global report highlights ATM industry trends
ATM Marketplace has published the fourth edition of its new ATM Future Trends 2015 report, an in-depth examination of the market forces currently working to shape the short-term outlook for the ATM industry. The Tri-annual global industry report is for the first time being offered at no charge, made possible by the support of Italian financial software provider Auriga.
The following excerpt is from the report, which is now available for free download at the ATM Marketplace website.
Welcome to ATM Marketplace ATM Future Trends 2015, a tri-annual look at the competitive, economic and technological forces shaping (or you might say reshaping) the ATM industry.
We’re pleased to have the sponsorship of Auriga behind this, our fourth edition of the guide, which allows us to make a valuable resource available industry-wide at no cost.
We’re also pleased to incorporate end-user opinions into the report for the first time with the inclusion of consumer data from two polls: one in the mature North American market and one in the fast-developing Indian market.
In some cases, we found consumer sentiment in both markets to be remarkably similar:
And in other cases, strikingly divergent:
We also found that the expectations and objectives of consumers and providers don’t always stack up the same way:
We hope that, in providing these types of insights, ATM Future Trends 2015 will serve as one more useful tool in the box as you work to formulate a business strategy that is sound, durable and responsive to consumer preferences and the rapid pace of change in digital financial services.
To understand the importance of this in today’s market, simply consider these current topics that were, at most, faint blips on the radar when we published the ATM Future Trends Report 2012:
This trend was only beginning to emerge in 2012, and received only a passing mention in that year’s report. The “reinvented branch” has gained momentum steadily in the past three years and is now at the center of the discussion about the future of retail banking.
This self-service model has been propelled by the development of advanced hardware — teller cash recyclers, video teller machines, cash-recycling ATMs — and the sophisticated software that not only drives them, but also serves as link to tablet-equipped staff no longer tied to a teller desk and computer monitor.
FIs are seeing this new technology as a way to reduce the branch footprint, realize cost efficiencies in staffing and operations, and redirect staff time from teller functions that create cost to sales functions that generate revenue and reinforce customer loyalty.
In the 2012 report, two-thirds of ATM deployers named ATM security/regulatory compliance as their No. 1 trending concern. But criminals have since demonstrated that advanced security devices and regulatory compliance are not the whole answer.
This has been underscored by an increase in ATM cashing-out or “jackpotting.” There are several variants on this type of attack, but the common denominator is the introduction of undetectable malware onto a machine via physical access to its hard drive. This allows the criminal to send cash dispense commands, emptying the machine’s vault.
In another computer exploit, cybercriminals stole masses of prepaid card numbers from a provider’s database and, further, removed the spending limits on those cards. A coordinated global ATM cash-out using counterfeit cards netted the well-organized gang $47 million.
By 2009, financial institutions were seriously considering the potential in mobile banking. In that year’s future trends report, 35 percent of respondents said that “deploying solutions that integrate mobile banking and marketing with the self-service channel” would be the most popular trend over the next five years. At the time, though, there was little certainty about just how this might work.
By 2012, the notion of prestaging a cash withdrawal through a banking app was just dawning on ATM operators — and so was the realization that a virtual debit card could move from said banking app into a mobile wallet, risking disintermediation between bank and customer if that wallet carried another provider’s brand.
Introduced in 2009, the cryptocurrency was a non-issue for the financial services industry three years ago. In fact, the terms “bitcoin,” and “cryptocurrency” did not appear in the 2012 report at all.
At that time, we had no bitcoin ATMs, no foreign remittances via virtual currency, no questions about government regulation of a problematically anonymous payment instrument — unless you meant cash.
Now we have all of these things — and the questions that go with them. Will bitcoin replace cash? Improbable. Should ATM deployers consider adding bitcoin functionality to their fleet, or alternatively, investing in bitcoin ATMs?
Perhaps we’ll have an answer for that by the time we get to the 2018 report. And, we hope, we’ll see how well the trends indicated in the 2015 report end up serving the interests of the ATM industry — and its end user.