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As ATM industry gathers in Houston, major innovations and challenges impact business

As the ATM industry gathers in Houston for the ATMIA U.S. Conference 2020, industry experts say there are a number of issues that are impacting the industry, including bank transformation, consolidation, cash access and new technologies.

As ATM industry gathers in Houston, major innovations and challenges impact business


| by David Jones — Editor, Networld Media Group

As banking undergoes transformational change across the globe, the ATM industry must adjust to stay relevant. Incumbent banks — facing competition from neobank competitors in the U.S. and abroad to Silicon Valley powerhouses like Google, Facebook and Apple  — are completely rethinking the way they interact with customers and changing the role of the traditional branch and the ATM.  

These factors are forcing the ATM industry to change the way it interacts with the banks, merchants and consumers. And experts are discussing just that this week at the ATMIA U.S. conference in Houston.

Chris Gill, senior director, global advisory services at Diebold Nixdorf, told ATM Marketplace that some of the biggest challenges facing the industry today include nontraditional competitors, open banking, PSD2 and omnichannel engagement. 

"Financial institutions are also faced with an increasing number of options for enhancing their self-service channels, and as a result they tend to chase their competitors' projects rather than identify critical initiatives that will make them a leader in their market," he said via email. "In order to remain competitive and overcome these challenges, financial institutions need to harness and build on their organizations' current strengths."

Access to cash remains an important issue for millions of retail bank customers, and the ATM industry is at the center of that discussion. Across the U.S. and other major world markets, the continued role of cash in the economy and the ability to access cash is a leading challenge facing the banking industry.

"Cash remains relevant in an evolving digital world, which means that even more than 50 years after the advent of the ATM, financial institutions find that ATMs continue to play a similarly vital role," said Ben Hickinbotham, vice president, MoneyPass, Card Services at Fiserv Inc., a global provider of financial technology. "Indeed the ATM has become a physical touchpoint that keeps customers and members connected to their financial institutions."

One issue that has taken on increasing importance to consumers is access to cash without extra surcharges, particularly for the underbanked. Many of these customers live in rural or lower-income communities where the amount of bank competition and access to full-service ATMs are limited. 

Hickinbotham cited a 2019 survey by Mercator — the ATM Benchmark Report — which found that 77% of consumers do anything they can to avoid paying ATM surcharges, while 65% of consumers actively seek ATMs located in surcharge-free networks. 

"Average ATM surcharges continue to increase, and giving account holders the ability to receive surcharge-free transactions outside of their traditional footprint and whenever they travel leads to increasing cardholder convenience, satisfaction, retention and acquisition," he said. 

Competitive pressure

Fintechs are competing against the banking industry at a much lower-cost basis without the burden of legacy technology systems, aging branch real estate and layers of regulation and high labor costs. Silicon Valley, particularly the social media giants, have access to millions of young millennial and Gen Z consumers who use modern smartphones, voice technology and other tools to shop, pay bills and share cash in ways their parents never considered. 

Those trends have triggered a slight drop in the number of cash withdraws, according to the Federal Reserve, which reported that consumers made 5.2 billion withdraws in 2015 but only 5.1 billion in 2018. The amount of cash withdrawn, however, increased with the average withdrawal in 2018 being $156 — $10 higher than in 2015. 

Merchant relations

The rising use of mobile wallets and other payment apps have had a lesser-known impact on ATM use. They impact the role of Independent ATM Deployers, (IADs) who manage the use of ATMs at retail sites and other off premises locations. 

Retail stores are a major site of ATMs, particularly for cash withdrawal, however, the increased use of mobile wallets has reduced the need for these types of transactions, according to Minhas Vellani, president and CEO of ATM Link Inc.

"Retailers are still needing the ATM and will continue, but the (number of) transactions per ATM per month have dropped," he said. 

This drop in transactions is putting pressure on IADs to grow organically or forcing them to grow through acquisitions in order to remain competitive.  

Cover image: iStock

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ATM Industry Association (ATMIA)

605.692.2263


The ATM Industry Association, founded in 1997, is a global non-profit trade association with over 10,500 members in 65 countries. The membership base covers the full range of this worldwide industry comprising over 2.2 million installed ATMs.

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Diebold Nixdorf


As a global technology leader and innovative services provider, Diebold Nixdorf delivers the solutions that enable financial institutions to improve efficiencies, protect assets and better serve consumers.

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David Jones

David Jones is the editor of Mobile Payments Today. He is a veteran business and technology journalist, with three decades of experience writing about business travel, real estate and technology.

Since 2015 he covered a range of technology stories for the ECT News Network, which includes the E-Commerce Times, TechNewsWorld, LinuxInsider and CRM Buyer, writing about cybersecurity, artificial intelligence, machine learning, open source computing and privacy issues among others. He recently covered FinTech issues for PYMNTS.com.

He worked as a staff writer for Bloomberg Business News and an online reporter for Crain’s New York Business. He has written for numerous media organizations, including Reuters, The New York Times, The Real Deal, Continental, City Limits and The Nation. 

He was previously awarded the George Washington Williams Fellowship for Journalists of Color by the Independent Press Association. 


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