ATM Trends for ISOs 2023
The now three-year-old pandemic accelerated chatter in the payments world that cash was quickly going to become irrelevant in today’s society. The use of card payments, online payments and contactless everything trended upwards at an accelerated rate. Indeed, businesses whose main stream of income was cash-related, suffered serious blows. Many were forced to pivot their business models, but the pandemic was devastating to those whose business was dependent on cash.
Three years on, the effects of the pandemic can still be seen in the retail ATM world. Cash trend watchers are expecting rises in costs associated with ATMs – manufacturing of parts, shipping delays, shipping expenses, labour and general stock price increases. As costs rise, ATM operators may seek cut costs by using competitive companies to outsource their ATM field maintenance. Other cost cutting activities may include reducing their stock or adding less expensive machines to an operator’s artillery.
ATM security has also become an increased concern for retail operators. As job security remains a challenge, there has been a steady increase of both internal as well as external theft. Operators and businesses have had to cut budgets, often from fraud prevention mechanisms, and this has led to more opportunities for employees to dip their hands in the pot. In addition, the other side to financial institutions discouraging in-person transactions and encouraging self service at ATMs is that ATMs are better stocked with cash – and the criminals know it! While financial institutions may have more capital resources to secure their machines, this is not always true for independent operators, and this shows with the increase in ATM theft during and after the pandemic.
Despite the difficulties faced by ATM operators, there are still reasons to be optimistic about the future. First and foremost, the need for cash has most certainly not gone away. Cash supporters will always maintain that there is a need for payment options, with cash still being strong and viable option, especially for small purchases and low income households. As a result of global inflation and political unrest, people have been hoarding cash for emergencies. Additionally, as travel continues to reach pre-pandemic levels, there is still a need for cash, and travelers favour ATMs as opposed to airport kiosks as the exchange rates are lower. Travelers are still cautious and frugal with their spending so cross border savings are always an added bonus.
As retail ATM operators seek to rise above the difficulties presenting themselves in 2023, it is important that they consider alternative avenues for revenue using their current machines or investing in new machines with added functionalities. Dynamic Currency Conversion and Foreign Exchange capabilities are just two conveniences that are easily added to most machines and that add alternative revenue streams to simple cash-out transactions. These functions are especially useful as travel across borders increases.
ATM technology also now allows for functions such as bill payments, micro-loan payments and person to person transfers. Performing these “self-service” transactions adds convenience and builds a loyal customer base, and of course provides additional revenue streams. Increased functionalities also help with security issues. The cash recycling function means that the risks of frequent human intervention to restock cash in the ATMs are reduced. ATM technology can also be used for auxiliary purposes such as market research, as well as acting as a free channel for product and service advertisements. ATMs have certainly moved beyond simple cash machines. Now is the time to move your ATM business to the next level.
Global Processing Centre can provide guidance and support on the latest ATM technology. Please contact us if you would like more information on how to increase your profits in your ATM business.
References
Whitepaper: Streamlining Cash Management in a Post-Pandemic World, By Jill Jaracz, Contributing Writer, ATM Marketplace
