Town Hall touches on ATM industry pain points, future plans
Since its introduction in 2016, the “town hall” meeting has become a highlight of the annual ATMIA US Conference, encapsulating industry-wide happenings in a tidy 60-minute package. Moderated by Tom Harper, founding director of ATMIA and CEO of Networld Media Group, publisher of ATM Marketplace, this year’s session covered a lot of ground. Here’s the recap:
Withdraw Cash Wednesday
Peggy Olson, president and CEO, Strategic Marketing
Olson opened the meeting with a report on the industry’s effort to promote cash use by consumers. The inaugural campaign launched Nov. 17 with support from:
- A consumer-directed website, video and emails
- Social media sites
- A holiday cash sweepstakes
- Test ads and ATM signage
Withdraw Cash Wednesday committee members have already begun work on 2018 plans and goals, using data gathered in the 2017 campaign, Olson said.
“We want to continue to build and grow on the momentum of this pilot year of 2017 and grow the initiative into something that becomes well known among consumers,” she said. “If you think about the American Express Small Business Saturday program … at this point in its 8th year, 61 percent of consumers are aware of the program.”
To get Withdraw Cash Wednesday to that benchmark, Olson said, “it’s going to take some time, it’s going to take some hard work, and it’s going to take some money.”
David Tente, Executive Director ATMIA, U.S. and Latin America
“The federal level has actually been pretty quiet, especially with the change in administrations,” Tente said. “Few regulatory actions are going on right now and I think that’s going to continue.”
States and cities are a completely different matter, he said. ATMIA has seen increasing regulatory activity by states, with some of those ideas working their way down to the municipal level, as well.
“We think there may be some continuing effort to put caps on ATM fees,” he said. “We saw a little bit of that at the state level last year. And it’s kind of unusual, too, the things that we’ve seen — proposals to limit the vault cash — and you just never know what’s going to pop up.
“A lot of people still don’t fully understand the ATM business so we all have to be good stewards from that standpoint and make sure that people do understand how things work and the impact of these proposals on the end consumers.”
Donna Embry, Chief Payments Advisor, Payment Alliance International
“In many cases, when people say ‘follow the money,’ I look at it in a different way. I say, ‘follow the consumer,’ and if you watch the consumer today and what the consumer trends are, you will be able to anticipate what those future products will be that you might need to support that consumer,” Embry said.
Embry identified several trends worth noting:
1) The move to self-service — ATM operators should take a note of what’s going on with online and mobile shopping; “Consumers want what they want their way, any way, any time, anywhere.” For ATM operators that means check cashing, instant cash availability, rewards and redemption.
2) P2P payments — “I think there is a way — with the mobile phone and cardless transactions that are coming down the pipeline — to monetize that.”
3) Biometrics — Mobile ID and PC biometric ID are “sort of the training wheels for consumers to feel comfortable with biometrics,” Embry said. She added that future developments would pave the way for biometrics at the ATM.
4) Consumer targeting — “How can we take advantage of the ATM to be able to market and enable consumer to impulse buy, just like you would in a store,” using geofencing, beacons or content marketing.
Mike Lee, CEO, ATMIA
“Five billion people around the world now use a mobile phone … that’s over two-thirds of the human race,” Lee said. “And what is our industry going to do to connect with the mobile world? That’s what the Next-Gen ATM Project is all about.”
In the most recent ATMIA survey, the No. 1 concern among industry members — ahead of security, interchange and the war on cash — was the future of the ATM, Lee said.
ATMIA’s response is the Consortium for Next-Generation ATMs. “This is definitely the most exciting project I’ve ever been involved in.”
The consortium is working on a new architecture that will allow the ATM to occupy “a central position as a channel in the mobile-digital world and tomorrow’s Internet of Things.”
The consortium — which now includes more than 100 companies across the ATM value chain — has signed off a blueprint for an API app model for ATMs in which “the main way of transacting with the ATM will be through the consumer’s mobile phone,” Lee said.
That accomplished, members are now working on a 10-step plan for implementation of the architectural blueprint. Lee added the consortium is open to involvement by all industry members, “so please join this future-proofing exercise as the technologies of the world converge.”
Daryl Cornell, CEO, Triton Systems
“I think there are three things going on this year that are going to impact every person in this room,” Cornell said:
1) “This is the year — 2018 — when the U.S. ATM market reaches full saturation … which means that there’s not a whole lot of room for growth.”
Cornell said that the industry could expect annual sales of new ATMs to drop from 40,000 to 10,000. For IADs, this means a loss of bargaining power with manufacturers for perks like parts, software and support when purchasing an ATM.
2) “Banks are really looking tired. We had it bad in the retail world with ADA and EMV, but these folk’s have it even worse.”
Ongoing OS upgrades requiring updates to “unsupported hardware that’s not all that old” will have banks rethinking their ATM strategy, Cornell said. This couple present an opportunity for IADs who are looking to provide outsourcing services.
3) “Continued consolidation in the IAD space; we’ve seen that in other countries and believe that will continue here.” Cornell said this was especially true for operators in the 50–100-ATM range. “It’s just really difficult: You can’t do it all yourself; you can’t afford staff; there’s price pressures, continuing upgrade pressure.”
Cornell said that he expects that those deployers will continue to leave the market in the future, affecting the number of remaining players. “And that has implications for everyone.”