6 ATM insights revealed at DN Intersect

Diebold Nixdorf wrapped up its three-day DN Intersect conference this week in Las Vegas, where partners and vendors came from around the country to hear about the company's plans for the future and to check out its DN Series family of ATMs.

Below are a few takeaways from the event:

1. Diebold Nixdorf is in a good place now 

A little more than a year ago, Diebold Nixdorf was going through rough times. Its 2018 Q2 earnings report was grim. At that time, the company was just beginning to turn the ship around. It's new president and CEO Gerrard Schmid had been at the helm for five months, and the company was launching its DN Now initiative, an aggressive effort to cut cost and revitalize the company. 

Today, the numbers are looking better. The company's stock price, which was less than $5 a share this time last year, is now up nearly threefold, and its execs are spreading the word that the future looks bright.  

2. Cash recycling is the future

Diebold Nixdorf is promoting cash recycling over cash-in and cash-out ATM machines. Cash recycling ATMs, which dispense the same notes they take in as deposits, are popular in Europe and gaining traction in Brazil, but the U.S. has been slow to adopt. 

The company's new DN Series of machines come pre-equipped with cash recycling technology. It's a matter of switching on the firmware when ATM operators are ready to make the change. 

"There are very few recycling ATMs in the U.S., whereas in other parts of the world, it is starting to become a more popular technology. We're almost convinced that now in the U.S. we're ready to move into recycling," Schmid told reporters. 

3. It's a connected world

The new DN Series machines are filled with sensors, which — as Octavio Marquez, the company's SVP and managing director, Americas, explained — monitor virtually all of the moving parts in the machine. The data is then collected and sent into a cloud environment called the AllConnect data engine. That way, if there is a service call, the service rep can narrow down the problem and potentially arrive at the scene with the needed parts on hand.

APIs and software are also big news. One of the things that's unfolding in this industry is that consumers are no longer only withdrawing cash at the ATM, Schmid said. "It's much more part of a broader transaction set that they're engaging in. They might need to go to their mobile phone to check account balances. They might have a need to to pre-stage a cash withdrawal. So what you're seeing is a rapid conversion between the digital world and the physical world." 

4. Cash is still king in many parts of the world

"People say, Oh, but I never have any cash in my wallet," Schmid said. "And while that might be their individual frame of reference, that's not the reality of what's happening globally. We are active in 130 different countries, and many countries are still very, very cash intensive." 

Many of the unbanked are also entering the financial world. "We see transaction activity continue to grow very rapidly as more and more of the unbanked population are moving from stuffing cash under their mattresses to being participants in the financial industry," Schmid said.

5. Brazil and Mexico are huge market for ATMs

While many of Diebold Nixdorf's customers at the conference were smaller banks, who might have 100 branches and 50 ATMs, Schmid remarked that some of the company's bigger bank clients in Mexico and Brazil have as many as 30,000 machines per bank. Brazil is by far the company's biggest market. 

6. Bank branches are here to stay

Bank branches are undergoing a transformation. They are reducing their footprint as banks shift to digital. But, "there is no scenario that I can envision where banks are going to be fully branchless," Schmid said. He also believes that neobanks — banks that are 100% digital and only reach customers via mobile apps — do not pose a threat to traditional banks, which have the upper hand when it comes to more complex banking services.