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Deposit automation generates buzz at RD

'Deposit' and 'automation' were two of the biggest buzzwords at last week's Retail Delivery Conference & Expo in Atlanta. On the show floor and in presentations, it captured attendees' attention. There was plenty of other cool stuff, too.

December 1, 2002

"Automation," long a hot buzzword in the ATM business, practically sizzled at last week's BAI Retail Delivery Conference & Expo in Atlanta when it was combined with "deposit," a term that until recently had been viewed with lukewarm interest.

The industry's interest in deposit automation was evidenced by activity in the exhibit hall and mentions in key presentations.

NCR devoted fully half of its booth to a demo of how checks could be deposited at the ATM without an envelope, creating an image of the check on both the ATM screen and receipt, then sending it to NCR's ImageMark back-office processing system for archiving.

The ears of all those attending a presentation called "Using the ATM Channel Strategically" pricked up when Jonathan Velline, Wells Fargo's senior vice president of ATM Banking, said that Wells had conducted a five-month trial of envelope-free deposits in northern California earlier this year. Velline called it a successful "proof of concept" that scored on both the technology and customer satisfaction fronts.

If traipsing the show floor made Retail Delivery attendees hanker for a stogie, they were in luck. All they had to do was stop by the e-Bank booth for a hand-rolled smoke.

While Wells won't do end-to-end electronification of checks for some time -- "that's a big investment," said Velline -- it does plan to offer its customers images of checks at the ATM and use digital images of checks to speed up its back-office processing operations.

In another presentation called "Survival in the Off-Premise ATM Market," PNC Bank senior VP of Self-Service Banking Jim Walker identified check deposits as a promising future application for off-site machines.

"If we get the legislation on truncation (the Check Clearing for the 21st Century Act, fondly known as Check 21 to those in the industry), we'll be able to take checks and actually make money at off-premise ATMs. It's impossible today when you have to pay for transportation to visit the ATMs daily," Walker said.

(The Act, which was known as the Check Truncation Act when it was first presented to members of the Senate and House banking committees in late 2001, would allow banks to substitute digital images of checks for the paper.)

Software developer Infonox announced deals with not one, but two companies -- Advanced Financial Solutions and Wausau Financial Systems -- to combine its Active Payment Platform with the companies' imaging technologies to capture check images at the ATM rather than at the usual central bank or processing center.

Andrew Kurtz, Wausau's senior product manager, said his company partnered with Infonox to be able to offer check imaging to smaller financial institutions. Currently only those large enough to drive their own ATMs can offer imaging, he said, as none of the large processors has certified it.

Wincor Nixdorf introduced a Check/Cash Deposit Module which offers bulk cash and check acceptance in the same module, rather than two separate ones. Both cash and checks are stored in escrow until the customer approves the deposit. Scott Hackl, vice president of Wincor's Banking Solutions, said it's easier for ATM users if both cash and checks are deposited into the same slot.

Other than the possible reinvention of ATM deposits, here's what caught this editor's attention:

You've got the silver: Based on the assumption that folks have got drawers, jars and other receptacles filled with change, several companies have created ATM applications for bulk coin acceptance.

In the Wincor booth, crowds gathered around its compactBANK ATM, four of which have been installed at branches of Panama City, Fla.-based Tyndall Federal Credit Union in the past six months. The machine validates and counts coin -- up to a quart jar's full -- and kicks out ringers such as keys and tokens. Janet Turner, Tyndall's VP of interactive services, said her institution has generated buzz -- and gained some new members -- with this feature.

"We've had waiters and waitresses bringing in jars of tips and joining because they liked our service. And we've had kids bringing in piggybanks; we're hoping to make them members for life," Turner said.

Cummins-Allison Corporation, which is better known for its currency sorters and paper shredders, debuted a Coin Deposit ATM that, like the compactBANK, quickly sorts through a pile of loose change and credits it to an ATM user's account. According to Cummins spokesperson Angie DeJaynes, California's Golden 1 Credit Union will deploy several of the machines in 2003.

At the Loomis Fargo booth, attendees could test their luck at winning the tchotke of their choice: a light-up pen, bouncy ball or tiny Matchbox armored car.

Though not designed to accept an entire jar of coins, Tranax Technologies showed a new cash acceptor with its MiniBank 2500. The acceptor is to allow those without bank cards to pay for services such as pre-paid phone top-ups. Tranax CEO Hansup Kwon said it will be available in January as an option on the 2500 and as an upgrade on the MB100 and MB2100.

Let the good times roll: Winning the hearts and stomachs of attendees -- if not the livers -- next year's RDS is scheduled for Nov. 18-20 in New Orleans.

Feeling gravity's pull: Explaining his company's decision to partner with a company called Onepoint4 to deploy ATMs next to coffee/pastry carts in the UK, Moneyboxmanaging director Paul Stanley said, "We call that the gravity factor; the closer you can get people to an ATM, the better the chances are that they'll use it."

Pass on promos: Both Wells Fargo's Velline and Jim D'Aprile, FleetBoston Financial's VP of Self-Service/ATM Banking, said their banks will not run third-party advertisements on their ATMs in the near future. Such ads "did not resonate" with customers, Velline said. "They come to the ATM in a banking frame of mind. If you put bank messages in front of them, they are far more likely to respond."

Third-party ads are not part of Fleet's strategy, D'Aprile said, adding that a successful pilot with Theatre.com in the late spring of 2000 helped Fleet learn how to better promote its own products at the ATM.

Fee or free: Attendees could get cash at a surcharge-free ATM, a popular feature in the Diebold booth for the past four years. So why would they pay $1.50 to use a Diebold-branded machine in the Georgia World Congress Center's lobby? (It's actually part of a portfolio Diebold sold to Houston-based ISO Cardtronics in October.)

Controlling the cash: Version 6.0 of Gasper Corporation's Vantage software includes a Cash Monitor feature to help its users eliminate the problem of ATM cash sensors that give only two to three hours advance warning of a cash-out, while most armored carriers require twice as much time to make an emergency run. A CIT Tracker feature also will allow Vantage users to better monitor the performance of the armored carriers that service their ATMs.

In the Glory booth was what the manufacturer calls the world's smallest ATM. Its PZ machines range in height from 19 to 29 inches and are just 8 inches wide. None weighs more than 136 pounds.

Charlie McGratty, Gasper's director of marketing, said Vantage 6.0 will interface with two of the industry's most popular cash forecasting systems, Carreker Corporation's iCom and Transoft Corporation's OptiCash, by the end of 2002.

You have e-mail: During a demo of its Prism software, Fujitsu showed how ATM users could opt to receive their receipts via email, a nice feature that could cut down on all that discarded paper at the ATM. Plus, banks can include marketing messages with the receipts and better track customer response to them.

Sweater chic: Those working the Tranax booth wore a sweater/tie ensemble that reminded one of beloved kid TV host Fred Rogers. "It's a beautiful day in our neighborhood," said Tranax sales director Bill Dunn.

Going remote: Diebold has added an advanced-function ATM to its RemoteTeller walk-up unit that uses two-way video technology and a pneumatic tube to allow customers to interact with a teller. Diebold developed the RemoteTeller in 1996 and says that 945 of them -- sans ATM -- have been deployed.   Bob Nemens, Diebold's global marketing manager, believes that the RemoteTeller concept could work well in supermarkets where retailers are loath to give up space for store branches, as well as in markets where banks cannot afford to invest in full branches to serve rural areas.

Driving transactions: Fujitsu and Wincor Nixdorf have introduced their first-ever drive-up ATMs, to appeal to financial institutions that may want to replace old units to comply with Triple DES and ADA regulations in the next few years. Both Fujitsu's 8031 and Wincor's ProCash 2350 offer the same footprint as the industry's drive-up workhorses, NCR's Personas 90 and Diebold's 1074.

Wincor's unit offers a nice design detail: a small light placed on the side where it's clearly visible to motorists that glows green when the ATM is open for business, red when it's not.

Fujitsu is offering a special trade-in program through December of 2003. Fujitsu will take another vendor's old unit, sell it to a refurb shop, then subtract the machine's resale value from the cost of the 8031, said Kent Schrock, director of marketing.

Breaking through the wall: While retail-oriented manufacturers have long encountered skepticism from financial institutions, Tranax and GTI both hope to win bank customers with new through-the-wall units. Both Tranax's MBS5000 and GTI's TTW-2000 are designed to attract institutions that may seek more economical alternatives when replacing their old through-the-wall machines to meet regulatory requirements.

New and improved: ACI Worldwide president Mark Vipond said his company intends to migrate most of its BASE24 users to its new object-oriented BASE24-es over the next few years. One of es' niftiest features, Vipond said, is a scripting engine that allows users to define how transactions are authorized - using different procedures for those identified as higher risk, for example.

ACI introduced es, which can be used on IBM's zSeries and Sun's Solaris systems in addition to the more common HP NonStop system, to gain market share. "We work with 22 percent of the world's top 500 banks. Another 43 percent write their own software; if they haven't bought yet, they probably won't. But that leaves a good number for us to go after," Vipond said.

It's tough out there: Jim Zimmerman of the Shazam network said tightening competition among EFT networks has led to far less flexible contracts, with higher de-conversion fees and more "right of first refusal" clauses which give networks an opportunity to match the prices of their competitors. This means that some network members remain locked into unhappy relationships where service, not price, is a main complaint, Zimmerman said.

Infonox's Active Verifier digitally scans an ID and compares it to a biometric photo to establish a check-cashing customer's identity.

Really tough: Living up to his image as a five-star general in the ATM army, PNC's Walker introduced his presentation by saying he wanted to share some of PNC's strategies for success in the off-premise market "without telling you everything so you can defeat me."

Walker's tip for vendor relations: "Stay on their case so they provide the best service. They'll service your ATMs before the other guy's if they know you'll notice." He always tries to get exclusivity with his contracts -- "I won't do very many deals without it" -- and requires his partners to live up to promises such as minimum customer counts.

Yet Walker knows how to pick his battles. Noting that PNC has few ATMs in supermarkets where PIN-based debit is a common method of payment, he said, "How can I compete against free money in the checkout lane when I'm charging $1.75 for it?"

Kitchen connection: Stuart Scott, a sales representative for Companion Systems, said Corian is just as popular on ATM surrounds as it is on kitchen counters. "We used to use a lot of stainless steel, which would get scratched and look awful," Scott said. "With Corian, you just buff scratches right out."

Positive ID: Infonox showed a device called the Active Verifier, which provides a method of identifying check cashing customers in an automated environment. A customer inserts his photo ID into an acceptor, which then scans it and shows an image on the ATM screen. The customer is then notified that a camera will take his photo so that an enrollment center can compare the images. "We think that will send a thief running out the door," said Vali Maskatiya, Infonox's VP of operations.

Certification stakes: Both GTI sales director Danny Langston and ATM Exchange VP Henry Dorfman predict that their new Triple DES conversion devices, the 9500 Wizard (for Triton 9500s) and the DES Wizard, respectively, will be certified by processors and networks. "If customers ask them to do it, they'll do it," Dorfman said.

Upping the ante: Online Resources, an Internet banking provider, was giving away cash by spinning a wheel marked with denominations from $1 to $20. A single Post-It note, with a handwritten $50, was nearby. "That's for folks who spend 20 minutes or more in the booth," said regional sales manager Kevin Scheid, who said his company gave away about $1,300 on Day One of the show.

EFunds update: Todd Hannon, eFunds' VP of ATM management, said that while acquisitions have earned plenty of attention for his company in the past year, it continues to add new locations through its sales force. "We shipped more than 270 ATMs in October," he said.

Speaking of acquisitions, according to the Access Cash press kit, Hannon "has successfully orchestrated the integration of five companies" in the past 10 months and also refers to Access Cash's management of 16,700 ATMs. For those who can count and are waiting for the official announcement, it likely won't come until 2003.

Mapquest, anyone?: It's one thing to provide direction to a company, but it's another to navigate your way through downtown Atlanta traffic. Even for someone who lives in the Atlanta area, like Hannon.

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