Article

ATMs lower the cost of cash by recycling it

ATMs with cash recycling capabilites are already popular in Asia; several companies think there might be a market for them elsewhere as well. by Ann All, editor

March 11, 2002

While recycling is a concept that has made waves in environmental circles, it has yet to make a big splash in the ATM industry. Several manufacturers make ATMs with cash-recycling capabilities, but they're just beginning to investigate the market for these products.

Cross International Technologies

Cross International Technologies' HT 8000 is widely used in Asia, where consumers "need more cash than in Western countries," said Cross International Technologies President Hansup Kwon. In Asia's cash-based society, it's common for ATM users to "withdraw 100 notes at a time," Kwon noted.

The HT 8000 is also popular among Asian merchants who deposit their day's proceeds into the ATM, where it is counted and credited to their account. Kwon thinks that small business owners could create a possible niche market for cash recycling in the U.S. and other Western countries.

He thinks it's less likely to catch on with typical ATM users in the West. "In the U.S. it's generally a one-way street," Kwon said. "People want to get money out of an ATM rather than putting it in."

Consumers can put a mix of different denominations in the HT 8000, which processes up to 150 notes in 2 minutes. A bill recognition system ensures that none of the cash is counterfeit, then the money is counted and separated. The screen asks the user for confirmation of the amount, which is then credited to his or her account. The HT 8000 also dispenses up to 150 notes at a time, at a speed of about eight notes a second.

The ATM has four cassettes, each of which holds approximately 3,000 notes. Only one cassette recycles cash, typically the most popular denomination, while the other bills go into a secure bin.

The high cost of the HT 8000, about $50,000, means it probably won't be deployed much outside of Asia, at least for the time being. "In my opinion, it would be more suitable for niche markets," Kwon said. "That could happen somewhere down the road."

Fujitsu

Fujitsu's ICL Financial Services division produces a cash-recycling ATM called THE FACT - Asp. They are popular in Japan, where about 17,000 have been deployed, because of the way cash at Japanese banks earns interest. Users commonly withdraw cash from them on their way to work and then deposit any remaining cash on their way home so the money can earn interest overnight.

Brian Bragg, marketing product manager international, said THE FACT - Asp also has generated "a tremendous amount of interest" in Latin America. Fujitsu's previous generation of the Asp was an attention-getter at the Tecnobanca trade show in Mexico City.

Latin America has a cash culture similar to that of Asia, Bragg explained. "The vast majority of purchases there are made with cash, and credit cards are still largely limited to the upper classes."

THE FACT - Asp, which uses a Windows NT-based operating system, accepts six denominations of coins and three denominations of bills. It recycles two denominations of bills. While Bragg doesn't foresee a widespread need for cash recycling in the U.S. and other Western countries, he thinks the technology could help reduce the costs of handling cash.

"When you look at the recycling technology from a component point of view, the component would be very appropriate in some of our markets," Bragg said. "It's very expensive to handle cash everywhere."

Bragg thinks cash acceptance, as opposed to cash recycling, is more likely to find an audience in the U.S. and some other countries. "We may not see cash recycling, but we probably might see cash acceptance in some form at ATMs in the U.S."

Fujitsu ICL Espana has a new cash acceptor module, which Bragg predicts could be popular at Latin American banks that offer bill payment as a customer service.

"Financial institutions like the idea of being able to accept cash for bill payments, but teller interaction with a non-customer is typically a money loser," he said. "This technology could turn into a profit center for them if they could force non customers to use ATMs to pay their bills."

Diebold

Diebold has introduced the CashSource Plus 400P, an ATM with cash-recycling features that is designed specifically for low-volume locations where merchants want to avoid the cost of armored-car cash replenishment but don't want employees opening the vault.

Bob Nemens, manager of worldwide marketing, said Diebold's product, with a 150 bill capacity, is an ideal option for ATM deployers and retailers who want to provide their customers with access to a cash dispenser but may not have enough transactions per month to justify the operating cost of a more traditional ATM.

"It's designed for locations with 500 transactions a month or less," Nemens said. "If you have 6,000 transactions a month, this is not the machine for you."

One of the largest ATM expenses was reduced when dial-ups replaced leased lines. Diebold wanted to reduce the cost of an ATM even further by eliminating the need for expensive cash replenishment. A store clerk can fill the CashSource Plus 400P, a single denomination cash dispenser, with money from the register without ever opening the vault.

After the clerk uses a key to open an access door, the system will prompt him for a password and possibly an additional identification number. "It's configurable for whatever is needed for a location's audit trail," Nemens said. A strong audit trail is a necessity in retail environments which are "very skittish when it comes to accountability," he added.

As the clerk feeds bills into the machine, the incremental value is displayed on the screen. After all of the bills are inserted, the clerk is prompted to validate the amount and a cash-added transaction signal is sent to the network. The system can generate up to five receipts.

Like any Diebold ATM, the Cash Source Plus 400P can be programmed to transmit a low-cash signal to the network. A remote status light near the cash register or in a manager's office is another option. "It's a visual indicator to make sure the machine is up and running at all times," Nemens said.

The software was designed with the intent of streamlining the certification process. "We think it's important to be as accommodating as possible for the folks who have to handle transactions in a low-volume environment," Nemens explained.

Diebold plans to roll out the ATM in the first quarter of 1999.

Included In This Story

---

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.

Request Info

Learn More