How to optimize cash recycling

Since their introduction in Japan in 1982, cash recyclers have become a standard tool for large financial institutions across the U.S. This makes sense, as it enables cash-accepting ATMs to filter and reuse cash, which cuts down the frequency of replenishment, which can be expensive and a dangerous task.

But now the goal isn't just to install cash recycling hardware; it's to actually craft a cash recycling strategy that optimizes cash across the entire branch network. Anna Wasicka, product marketing manager, and Dan Jamieson, product manager at NCR Atleos, spoke during a webinar on ATM Marketplace about how ATM cash recyclers can integrate into a larger system, single vs. dual towers, and crafting an effective strategic framework for cash recycling.

Recyclers are everywhere

First off, Jameson pointed out that recyclers, by this point, are the primary type of deposit-accepting ATM out there.

"If you look at the kind of market dynamics now, we're now in a position where just about every single country in the world, you no longer just get a deposit-only device. People now buy recyclers and deploy recyclers," he said during the webinar.

He further added that the savings are very real, with recyclers able to operate on 30% to 40% less cash than non-recycling ATMs.

Single vs dual towers

Of the recyclers, single tower devices tend to be the most popular, as there is a lower total cost of ownership. Dual tower recyclers meanwhile have one tower that dispenses cash and another that recycles it.

Jameson acknowledges that in most places, having a single tower that handles both makes sense, but there are certainly circumstances where having a dual-tower brings benefits.

"The two towers let you have resilience," he said. "If someone comes along and drops a horrible stack of totes into the device, if it jams that dispenser there to connect it to a single tower recycler, you're in a situation where that thing's got a single point of failure."

What opportunities are there?

For Jameson, the biggest opportunities rely on tapping into data for smarter cash visibility, which can in turn reduce costs.

He gave the example of islands in the Mediterranean with heavy tourist populations that often withdraw all the cash from ATMs, requiring weekly cash replenishments from ferries. By installing cash recycling ATMs, they were able to cut that cost down significantly, as the businesses could just deposit the tourist cash back into the ATMs.

"And it's really nice because it creates this idea of like a circular cash economy on the island where the deposits and withdrawals are funding themselves," he said.

However, in order to take advantage of cash, banks don't just need hardware; they need to have actual cash management software that can unlock further insights into what denominations are deposited, cash usage trends, and potential cost savings.

In addition, banks have to be willing to make hard decisions, as cutting back on replenishments impacts reconciliation, contracts, disputes and more. There can also be regulatory components at play. This is why he recommends that, in some cases, it's good to embrace ATM outsourcing to a dedicated vendor that can handle those issues.

The ultimate goal for Jameson is to create a "cash orchestration ecosystem" that works within branches that can deliver on three issues:

• Lower cash inventory.
• Lower movement of cash.
• Put in place new operating models.

"If you go forward from here, the discussion is no longer whether a recycler is going to make sense. It's now about how do I take that recycling capability and use it to do a lot more across the branch and across the network to drive these three things far more clearly."

Click here to listen to the webinar for free.