The cost of owning and operating an ATM weighs heavily on independent financial institutions. New regulations regarding data encryption security requirements are making it necessary for credit unions and community banks to upgrade their ATM networks or replace certain equipment. Machines must either be equipped with or able to upgrade to the Triple Data Encryption Standard (Triple DES).

Due to limited budgets and the cost of new machines, which range from $15,000 to $30,000, many credit unions and community banks have found that it is more cost-effective to purchase refurbished ATMs. By purchasing pre-owned machines, credit unions and community banks can upgrade their networks without purchasing brand new equipment. With newer refurbished models, they gain the same advantages that new machines offer.

Furthermore, because refurbished machines are one-third to one-half the cost of new machines, independent financial institutions are able to purchase more machines for their money, and thereby, offer more ATM locations to their members.

ACG ATM-Remarketers, a provider of refurbished ATMs, purchases slightly used machines, then rebuilds and upgrades them according to the individual needs of credit unions and community banks. ACG also offers complete service support and warranty programs to its customers.

ACG provides refurbished ATMs to the University of Tennessee Federal Credit Union (UTFCU), which serves the staff, faculty and students of UT. The credit union has 21,500 members, total assets of $108 million and 12 ATMs.

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Like many credit unions, UTFCU doesn't make a profit from its ATMs, because its machines do not experience enough foreign transactions and related surcharges. However, buying refurbished machines from ACG has allowed the credit union to provide ATM service to its geographically dispersed members at an affordable cost. UTFCU saves one-third to one-half of its allotted ATM budget by purchasing refurbished ATMs.

Another ACG client, Marine Federal Credit Union (MFCU), has experienced increased activity within its branches since purchasing and installing refurbished ATMs from ACG

MFCU is working to be the primary financial institution of choice for Marine Corps employees and their families at Camp Lejeune, Quantico and surrounding areas. Currently serving 107,000 members at 14 branches, MFCU has 71 ATMs with plans to install five more. MFCU operates an in-house maintenance department, which mainly employs retired marines to service its growing ATM network. MFCU's in-house technicians received their training from ACG's maintenance training program.

"We've established a dominant position in our community as a result of having these ATMs," said Bonnie Hall, MFCU's senior manager of electronic cards. "There is a tremendous appetite for these machines from young military folks living paycheck to paycheck. According to Electronic Data Systems Corp., we have some of the busiest machines on the East Coast with some units doing 20,000 transactions a month."

Community banks face many of the same budgetary challenges as credit unions. In order to keep up with the increasing demands for updated technology, community banks also have turned to ACG's refurbished ATMs.

Caldwell State Bank needed to update its ATM systems to Triple DES, but did not want to invest in a new ATM. A larger bank in the area referred Caldwell State Bank to ACG for refurbished ATMs. ACG engineers its ATMs to be compliant with the latest in software technology, but at an affordable rate.

"Economics was the main reason behind our decision to go with a refurbished ATM," said Leo Schiltz, executive vice president of Caldwell State Bank. "We decided a refurbished ATM was adequate in meeting our needs and the needs of our customers."

Located in Caldwell, Kan., 60 miles south of Wichita, Caldwell State Bank serves approximately 2,500 customers. The bank does not make money from the ATM, but utilizes ACG's ATM services to keep customers satisfied.

"Even though the ATM machine is not a money maker for us, without one, we would lose customers," Schiltz said.

Bank of Lenox, a family owned and operated bank since 1906, purchased a refurbished ATM after being referred to ACG by another customer. The money saved on buying a refurbished ATM was used to purchase one more machine. This gave Bank of Lenox the opportunity to increase its services and expand its reach to its 4,500 customers in three different towns.

"Purchasing refurbished ATMs enabled us to continue to expand our ATM services into the South Georgia community at a cost-effective rate," said Michelle Robinson-Hyde, assistant vice president of Bank of Lenox.

ACG's refurbished ATMs enable credit unions and community banks to enhance self-service offerings and expand their geographic presence. Because of this larger reach, credit unions and community banks are able to establish a stronger presence in their communities, grow their constituencies and generate new revenue. At the same time, they are keeping customers happy and lowering their overall costs.