Bank / Credit Union

Effective cash management: how you can cut ATM ownership costs

How does your company manage its cash? Finding a cash management system can not only help you save costs, but save time as well.

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July 10, 2020 by Daniel Dawson

The global economy is projecting to contract sharply, at least by -3% in 2020, due to the COVID-19 pandemic. This projection is worse than what was endured during the 2008–09 financial crisis.

The Great Lockdown that we have all been through and now are seeing lift in some areas, but restricted again in other areas due to a virus resurgence, has an obvious impact on spending patterns. Many countries face a multi-layered crisis comprising of not only health concerns for the population, but domestic economic disruptions, plummeting external demand, capital flow reversals and a collapse in commodity prices.

Naturally, the banking sector has to adapt to these new conditions which are impacted by restrictive governmental measures and by customer behavioral changes. Around the world, many bank branches are still closed, and those that have opened are working hard to stay open and serve customers, generally by individual appointment only. Some banks are still opening earlier to accommodate at-risk customers and many banks are still waiving banking fees for customers.

Why ATMs are important for banks

What we have seen during this pandemic is that many banks can go digital and customers want that convenience, but an omnichannel experience is still needed today.

While banks can enable customers to access their services in numerous ways, ATM use remains the most common method of self-service bank communication. And in this "new normal" when customers are having to avoid or simply cannot visit bank branches, ATMs and other self-service devices become almost the only way for them to receive cash. Despite the increase in mobile payments, banks still have to develop and maintain the ATM which is a valuable channel of self-service banking.

Providing banking services through self-service devices can, and should, be considered when changing the bank's strategy for the future. Empowered ATM fleets can become a significant advantage when optimizing operating activities and reducing ATM ownership costs.

Having a professional cash management process, which includes a cash-in-transit service management, is an operational keystone for ATMs. Running an effective cash supply chain management, not only gives you growth of operational efficiency, but also sufficient operational cost savings. Cost savings in the short term becomes a strategic response in the long-term.

What does effective cash management mean?

Instead of using an excel-based or other in-house created cash management model, banking solution providers recommend using a modern cash management platform to reduce costs associated with cash distribution.

A cash management software platform is designed to solve the problem of inefficient cash distribution at cash collection and withdrawal points, such as ATMs and other self-service devices, as well as in bank vaults, branches, and retail networks. The cash management platform solution allows banks and processing centers to automate their operational processes and document workflows associated with cash circulation.

Deploying and utilizing the modern cash management system allows minimizing the cost of cash replenishment. This is due to optimized planning of cash resources and the reduction of unused cash in ATMs, bank branches, and vaults. It also helps to reduce CIT services costs as a result of optimized planning and reducing the number of unplanned operations.

Changing times calls for new solutions

We are in the midst of changing times and that calls for a business strategy correction and a new approach to providing banking services. This is mission-critical not only for banks, but for banking solution providers as well.

For an effective cash management solution, you need to work in close collaboration with strong partners. Through a cash management system, you can automate the process of assigning tasks and providing relevant access to CIT personnel which is one of the most useful ways to increase the overall efficiency of a cash flow process. Generation and distribution of access codes to electronic locks installed on terminal safes can become a part of your cash collection order assignment system. When creating a cash replenishment order, a cash management system can automatically generate a unique one-time code to open the safe door and then add the code to the CIT route document and have it sent to the collector in charge.

A one-time code generally has a time-window for the duration of which it can be used. This reduces the risks of internal fraud because the code cannot be used after the time limit is up. To get access to the safe of an ATM, payment kiosk, or another self-service device, the collector and use a generated code and an electronic key which can log all CIT-operator actions, eliminating the need for standard mechanical locks.

The use of electronic locks and the automatic generation of access codes are important conditions of the CIT service, especially now, during a pandemic. Quarantined CIT staff do not need to receive and give back physical keys, therefore, eliminating the possibility of the COVID-19 virus transmitted via keys, or through person-to-person contact.

As we shift to new processes established during the pandemic, consider a cash management solution for your institution. Its benefits include:

• Providing a higher level of security during cash collection by using a one-time single use code.
• Simplifying the work of the employee responsible for cash collection management.
• Accelerating the cash collection process by enabling collectors to spend less time at terminals.
• Reducing operating costs associated with the management of mechanical keys.
• Providing a more flexible approach to partial or full outsourcing of the cash collection service.

Although the effects of the pandemic are still very much a factor of our daily lives, there has never been a better time to review your company's CIT service and consider saving costs in the future with a cash management system.