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Commentary: ATMs on emergency call

In his latest installment of On the High Road, ATMIA International Director Mike Lee discovers how mobile ATMs are used to help victims of earthquakes in Turkey. In Turkey and elsewhere, the 'ATMs on wheels' are also used to make ATM services ever more convenient.

March 17, 2002

Mike Lee is international director of the ATM Industry Association, and is based in London.

Seventeen kilometers below the ground in a zone along the Gulf of Izmit in the Sea of Marmara to east of Adapazari in Turkey, the earth shifted, sending out huge, rumbling ground motions that accelerated rapidly. It was 3 a.m. in the dead of night on Aug. 17, 1999. While the nation slept, one of the biggest earthquakes to strike an industrialised area since the 1906 San Francisco and the 1923 Tokyo earthquakes had begun. 

By the time it was over, 45 seconds later, the quake had killed more than 17,000 people. Its cruel epicenter was in Turkey's densely populated northwest, seven miles southeast of the city of Izmit. Thousands more were injured and many thousands left homeless.

The earthquake, which could be felt over 200 miles away, was a humanitarian and socio-economic disaster for Turkey.

Following several aftershocks, a second earthquake struck on Nov. 12 that year, killing hundreds more. Buildings across Duzce crashed to the ground.
 
Turkey is no stranger to seismic shocks. The 1999 quake occurred along the northernmost strands of the North Anatolian fault system, which has produced no fewer than seven earthquakes with magnitudes greater than 7.0 since 1939. (A major earthquake is defined as having a magnitude of 7.0 or more on the Richter scale.)

To cope with the problem of widespread homelessness following an earthquake, the Red Crescent Turkish aid organization typically sends tents, blankets and portable kitchens to the stricken areas.

Mobile money

But portable kitchens are not the only mobile services to be sent to disaster zones. Since 1998, Mobile ATMs have also been dispatched when there is damage to ATMs or disruption to electrical power and telephone lines. If ATMs are damaged or go offline in an emergency, the mobile ATM can be deployed very quickly.

Turkey's Pamukbank has led the way in deploying mobile ATMs to help restore normal services to populations shaken up by the earthquakes that have plagued Turkey. Pamukbank's innovative use of the mobile ATM to help its country cope with the disruptions caused by natural disasters is a credit to an industry I continue to regard as robust, responsive and inventive.

Pamukbank, headquartered at Gayrettepe, Istanbul, was established in 1955, and has 196 domestic branches, several overseas financial services branches and 722 ATMs.

In December last year, I met up with Sertac Ozinal, Pamukbank's vice president of retail banking, and Temel Yolgecenli, vice president of e-banking, in their Istanbul offices to discuss the impact of the mobile ATM in Turkey, both during emergencies and under normal circumstances.

Sertac, chairman of the Inter-Bank Card Centre in Turkey (IBC), explained that the mobile ATM was created by customizing three vans with compact cash dispensers that customers access from the vehicle's exterior. They each have their own power generator and satellite transmission. This makes them expensive to run.

Standard ATM transactions, like cash advances, deposits, fund transfers and the like, can also operate in the Pamukbank mobile ATMs. Pamukbank deploys mobile ATMs at football matches, bazaars and when military ships such as U.S. aircraft carriers dock at Istanbul harbor.

"The purpose of mobile branches is to improve customer relations and service, introduce innovative services/products to customers and provide access to an immediate service for cash needs at public events and at tourist spots in Turkey," he said. "And, of course, mobile ATMs supply an independent banking operation when existing facilities fail during emergency and disasters."

(Sertac Ozinal will talk about mobile ATMs in Turkey at ATMIA's conference "Optimising European ATMs" in Budapest, Sept. 23-25 - see www.atmia.com and click on Events.)

Economic aftershocks

Following a humanitarian disaster like an earthquake come the economic aftershocks. The costs of rebuilding Turkey after its devastating earthquake could turn out to be 16 times higher than the reconstruction bill for Kosovo, according to Tusiad, one of Turkey's leading business organizations.

The Turkish economy had struggled with a deficit of around $20 billion and an annual inflation rate of 50 percent and going up at times to 80 percent. Then, last year, Turkey underwent an economic earthquake when the national currency devalued and several banks were declared bankrupt, leading to significant consolidation in the banking sector. At present, ATM usage has gone down following the economic crisis of last year, with some ATMs for sale.

Following the 2001 devaluation, one pound now buys two million Turkish lira. When I returned from Turkey last year, I put a one million lira note in an envelope for each of my two daughters with a cryptic note saying "Open this to become an instant millionaire." Needless to say, they were not impressed when I was forced to concede that each note in real terms was worth only 50 pence.

Yet despite the economic challenges, the long-term ATM future in Turkey looks promising.

Traditionally the meeting point of East and West, and a gateway from Europe to the Islamic Middle East, Turkey is just behind the Big Five in terms of ATM deployment in Europe, with some 13,000 ATMs for a population topping 60 million. Turks are heavy card users, with 14 million revolving credit cards and 30 million debit cards in use (about half of which are active accounts). This should drive up further ATM deployment.

There is a good market for retail ATMs in the country, too. "Although shopping malls are new in Turkey, springing up over the last three years, there are usually two ATMs per mall," Sertac told me.

He believes the cost of an ATM should fall below $10,000 to be affordable for convenience stores. "Desktop ATMs would be ideal since space is mission-critical for store owners - they are easy to carry, easy to manage and have a small footprint."

The ATM industry is watching the security issues surrounding rapid retail ATM deployment in order to protect this sector from crime and fraud and to ensure it fulfills its future growth potential. To assist the industry in this goal, ATMIA is hosting a conference on end-to-end ATM security, called ATM Sec 2, on April 17-18 at the Manchester United Football Club, England (see www.atmiaeurope.com and click on Events).

Security lessons from countries like the UK, South Africa, France and Central America can be profitably and proactively applied to Europe's wider ATM markets before the retail ATM explosion gets underway.

South African brand awareness

Turkey is not the only country with a market for mobile ATMs. First National Bank of South Africa (FNB) has personalized its two mobile ATMs and made them part of its BOB brand. As with Pamukbank's mobile ATMs, communication requirements are met through cellular, satellite or normal telephone links and the vehicles have their own power generators.

First National Bank, with its distinctive logo of the Acacia tree in an African sunrise, is the oldest bank in South Africa, tracing its origins back to 1838. FNB is a member of ATMIA and has offered to provide a venue for the launch of ATMIA Africa in June this year.

Liz Hazell, responsible for Strategic Business Development of FNB's ATM network, points out that the BOB ATM Mobile creates a presence for the bank in the community:
"It is viewed as a 'mobile advertising' board for both the corporate and BOB ATM branding. We have deployed the vehicle at sports and entertainment venues, at trade shows and other events. It is also deployed to holiday resorts to cater for the influx of visitors to coastal areas in peak season."

As with Pamukbank's mobile ATM, the BOB ATM Mobile is expensive to run. "Volumes and consequently revenues are low. Deployment decisions are based on the value of brand presence rather than commercial viability," Hazell said.

The mobile ATM has made the ATM itself more adaptable and responsive, taking it to masses of people who are congregating for a specific purpose far away from busy city centers. A bank can turn up at the seaside, in a football stadium, at a flea market or bazaar - wherever people need money for the occasion, but cannot access it there and then.

ATMs everywhere?

With a mobile ATM, the bank itself becomes mobilized, just like mobile libraries that drive into a community to provide books on the doorstep. Will we see mobile ATMs driving into suburban streets, coming ever closer to the home?

Hats off to Pamukbank of Turkey and First National Bank of South Africa for the imaginative way in which the mobile ATM has taken banking to the people in a particular time of need, whether that has been in an emergency that causes both trauma and disruption, or when they have been simply enjoying themselves at a sports event or during an open-air market.

If ATMs can move from the walls of bank branches out into the retail environment and then from these off-premise locations into temporary sites even further away from banking halls, could it be that ATMs will end up one day being even more portable, appearing on desk tops, in suburban streets and even in our pockets?

In imagining how far ATM mobility will go, let's not make the mistake of underestimating the inventiveness of this industry. It has reinvented itself more than once in its three decades of existence to maintain its position as a premier delivery channel.

Included In This Story

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ATM Industry Association (ATMIA)

The ATM Industry Association, founded in 1997, is a global non-profit trade association with over 10,500 members in 65 countries. The membership base covers the full range of this worldwide industry comprising over 2.2 million installed ATMs.

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