Blog

ATM use provides insights into future deployment potential

September 25, 2013 by Dominic Hirsch — manager, Retail Banking Research

The recent publication of RBR's annual survey of the global ATM market provides a timely opportunity to examine the state of the ATM industry. The headline figures show strong growth of 8 percent in the number of ATMs worldwide, reaching a total of 2.6 million by the end of 2012. Three regions — Asia-Pacific, CEE and the Middle East and Africa — grew by more than 10 percent.

We have, however, witnessed spectacular ATM growth in emerging markets for several years now, and this raises the question of whether such growth can continue, and for how long.

I have previously discussed ATM density as a way of assessing ATM potential. Another useful way of looking at this question is to consider ATM use. From a deployer perspective this is often done by examining it on a per-ATM basis.

At a global level there were on average 2,587 cash withdrawals made per ATM per month in 2012, with most regions having an average of between 2,000 and 3,000. The two notable exceptions were North America with 1,166 and MEA with 5,748.

The low North American average is a direct result of the large share of non-bank ATMs. MEA's figure is partly due to extremely high use (of more than 10,000) in Iran, although most countries in the region display above average use on a per ATM basis.

In general, banks or countries with above-average use per ATM can be expected to deploy additional units, and this means that even now with MEA's high unbanked population, more ATMs are needed. As more people enter the banking system, the pressure to deploy will increase even further.

To assess the longer term ATM potential, it can be useful to consider use from a consumer perspective.

Globally there are 1.0 ATM cash withdrawals per person per month. The highest use is found in western Europe (2.2) and North America (1.6).

Two regions stand out with low per capita volumes — Asia-Pacific with 0.8 and MEA with only 0.6. This suggests that as the number of people using ATMs and the frequency with which they do so increases, significant numbers of further ATMs will be deployed.

Combining these measures presents a clear picture. Asia-Pacific and MEA stand out as having above average use per ATM and below average use per capita — strong growth in ATM deployment will therefore continue for some time. 

Republished from Banking Automation Bulletin.

About Dominic Hirsch

---

None

Connect with Dominic: