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ATM trends to watch

Going into 2023, ATMs are at a crossroads both in terms of overall banking strategy and payments trends.

ATM trends to watchImage via Istock.com


| by Daryl Cornell — President & CEO, Triton Systems of Delaware, LLC

As has been true every year, our predictions will likely prove to be off the mark, highly questionable or just plain wrong. And yet, we will prognosticate again this year, on the off chance that do manage to land a few correct guesses. Here is where we see the ATM industry headed in 2023.

The cost of ATMs will continue to rise

Inflation remains entrenched as the prices of ATM components and manufacturing labor continue to increase. Higher interest rates mean that the cost of vault cash has skyrocketed. While the well-documented 2022 breakdown in international logistics has improved somewhat, factory production, ocean shipping, rail and trucking are still not operating anywhere near peak efficiency. Longer product lead times, higher product prices and a continued "just in case" inventory philosophy will all negatively impact the ATM manufacturing industry in 2023. Financial institutions and independent ATM deployers should expect product lead time challenges, price increases and intermittent out of stock situations. While these conditions will hopefully ease sometime this year, plan for higher ATM hardware, software and maintenance costs in 2023.

The rise of the third-party ATM field service organization

As manufacturers continue to roll out cost reduction initiatives, one of the prime casualties will be OEM field service technicians. Outsourcing ATM installation, upgrade and service activities to third-party providers allows OEMs to shed fixed costs, albeit at a price. Increased revenue opportunities for regional and national ATM field service providers should also drive ongoing consolidation. Industry challenges such as technician sourcing, field service operating expenses, pricing and delivery quality will separate the winners from the losers in this space. Look for strong growth in ATM field service organization revenue in 2023.

Global cash use will plunge further

Cheerleaders for cash argue that payment choice is a fundamental right. Supporters point out that cash works, even during disruptions to the digital payment infrastructure. Cashless advocates will argue that the use of cash, particularly for purchases under $100, continues to decline and that non-cash payment methods are far more convenient. Both positions are correct. Despite global inflation pressures, people around the world continue to hoard hard currency as a hedge against economic and political risk. This raises the demand for cash— particular large denomination notes. At the same time, alternative payment methods such as NFC and P2P have driven customer preference away from cash. The difference in 2023 will be the increasingly aggressive government and card brand bias against cash. Governments love the idea of digital national currencies, easily monitored and controlled. The card brands continue to salivate over the demise of cash as a key driver of credit and debit growth. Look for continued cash use shrinkage in 2023.

Expect more ATM manufacturer woes

The reality is that return on investment for ATM manufacturers is dismal. The global ATM industry is both mature and highly competitive, meaning little top line growth and continued margin compression. If market cannibalism wasn't bad enough, factor in high debt levels at many manufacturers, taken on when interest rates were low, and you have a toxic brew. With a glut of global capacity, manufacturers have feasted for decades on planned obsolescence, using Windows as the scapegoat. Hardware price increases and expensive software maintenance licenses have not been enough to lift ATM hardware margins out of the single digits. Look for spin offs of low margin ATM manufacturing divisions, market exits and even an OEM bankruptcy in 2023.

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Triton Systems

21405 B Street // Long Beach, MS 39560 // 886-787-4688


Triton FI based products • NO Windows 10™ Upgrade • Secured locked down system that is virus/malware resistant • Flexible configurations - Drive-up and Walk-up • Triton's high security standards • NFC, anti-skim card reader, IP camera and level 1 vaults are all options • Triton Connect monitoring • Lower cost

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Daryl Cornell

Daryl Cornell is the CEO and owner of Triton Systems, a Mississippi-based ATM manufacturer, software, parts and service company.

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