The following Q&A is part two of a two-part series regarding the European Payments Council plan for same-size standardization of ATM cash cassettes across Europe. Click here for part one.
The European Payments Council's goal with the cash cassette standardization plan is to make storage in transit and at facilities more efficient, thus reducing the number of trips to and from the ATM.
Opponents of the proposal say standardization would mean costly redesign, the removal of innovation and a negative impact on the environment due to an exorbitant number of "junked" ATMs, among other things.
Aleksandra Lubavs, director of EMEA marketing, communications and strategy for Diebold Inc., talked with ATMmarketplace about the company's stance on this hotly debated proposal.
The following responses have been edited for brevity and clarity.
What are the benefits or disadvantages of transitioning to standard-sized cassettes?
We recognize the short term operational efficiencies that would be gained from a standard-sized cassette, primarily benefitting cash-in-transit providers.
That said, there are several disadvantages to standardizing ATM cassettes.
First, manufacturers would have to redesign the dispenser mechanisms in ATMs. This would require an immense amount of investment and time to develop and test. There would then be a transition for this to occur and a resulting significant hardware and software upgrade cost to financial institutions.
Second, the parameters of what should define a standardized cassette are not clear from an industry perspective. Size is a basic example, if we reflect on the need for a large standard cassette or a smaller standard cassette. If we’re referencing a smaller ATM cassette, the reduced capacity would result in increased costs as CIT companies would need to fill the cassettes more frequently. A larger cassette would offer more volume but take up more space.
This need for redesign would also force design restrictions on the manufacturers and ultimately restrict innovation and flexibility of delivery to the customer. As financial institutions look to drive more transactions to self-service devices in branch transformation and efficiency models, it is important to recognize the expectations on flexibility in the future.
How do think this will affect CIT companies?
ATM cassette standardization would be a plus for CIT companies. They would be the primary beneficiary of the standardization of cassettes. From an operational standpoint it could make CIT companies more efficient.
Do you think standardization will have any affect on security at the ATM? Enhanced or otherwise?
If we assumed that standardization would be mandated, from a security standpoint, the security process could be standardized as well. A standardized security process is surely a plus, but it benefits the industry to have various and complex models to stay one step ahead of those attempting criminal activity. A layered security strategy, including cassette security procedures as one step in a comprehensive security program, is critical to a protected ATM estate.
How do you think standardization will effect manufacturers with regard to costs and redesign of current models?
On the whole, it would really depend on the depth and breadth of the standardization. We believe a single cassette form factor will take a significant amount of time and cost to implement, and will only work if everyone in the manufacturing industry and all associated CIT companies and ancillary industries agree.
From a manufacturer’s perspective, the costs would increase significantly, and it would take a large amount of time to implement. To provide a common cassette delivering optimal performance across a wide range of vendors would involve months or years of design, manufacturing and reliability testing.
The costs of such developments are significant and well-known, as we and other industry actors have been doing this for many years.
It would also force the industry to redesign dispensing mechanisms and possibly recycling mechanisms. Some terminals might not be able to be upgraded, which could mean a significant investment of new ATMs for financial institutions.
Do you have any final comments on what you think the effects on the ATM industry in Europe will be if the motion is passed?
We believe that this is a short-sighted approach in terms of total cash optimization and elimination of cost within the retail banking self-service market, and expect that adopting this approach would inevitably lead to hidden costs.
For more information on this topic, please visit our regulatory issues research center.