News
Hanco to deploy ATMs at British Post Office branches; initial contract is for 3,000 machines
March 17, 2002
LONDON -- Hanco ATM Systems Ltd., Tom Hannon's UK company, has signed a deal with Consignia, the holding company that runs the British Post Office system, to install ATMs in rural post office branches in an attempt to revive their fortunes.
According to a report in the Daily Telegraph, the initial contract is for 3,000 machines.
The Post Office hopes the machines will attract more customers to the branches, which have suffered recent financial setbacks. Five hundred were forced to close last year.
A Consignia spokesperson said that more than half of the remaining 17,500 post offices were in rural locations. Most country post offices are also general stores. Both Consignia and Hanco say the machines will be a boon to customers who might otherwise have to drive several miles to find the nearest ATM.
"We already have cash machines in some post offices and this is a provision we want to expand to our rural branches. The more services we can provide the better their chance of survival," the spokesperson told the Telegraph.
A convenience fee of £1.25 will be charged for every withdrawal, a measure that drew criticism from several consumer groups, according to the Telegraph report. Hanco will keep the biggest share of the fee, with a small share to go to Consignia and a larger amount to the sub postmaster or postmistress.
Geoff O'Connell, who led a campaign against the closure of his bank in Belford, Northumberland, described the plan as "usury" and said farming communities still recovering from the damage caused by foot and mouth disease would not be able to afford £1.25 fees.
"People already accept they have to pay a little more for their provisions (at post office branches), and we are sure they will accept the necessity of the £1.25 fee." said Tom Hannon.
Hannon recently sold his U.S. business, Peachtree City, Ga.-based Hanco Systems, to eFunds. In January of 2002, he established a new company called Hanco International ATM Ltd. in Ireland and hired Sherif Seddik, NCR's former director of worldwide marketing and business development, to run the new business. Seddik is expected to lead Hanco's expansion elsewhere on the Continent.
As in the U.S., ATM users at British post office branches will be advised of the convenience fee at the outset of transactions so they can halt transactions if they wish. There will be no fee for balance inquiries.
Hannon told the Telegraph that his company would need to achieve a countrywide average of 200 transactions a month to make the service profitable.
The Triton machines will be bolted to the floor, and Consignia staff will replenish the cash. Some sub postmasters and postmistresses said the freestanding machines posed too much of a security risk and they would reject them.
The sub post office in the village of Hambledon, Surrey, closed 10 years ago but has been reopened by a cooperative of local people.
Jane Woolley, a committee member, said: "We have looked into this proposal and decided against it. We already offer a limited banking service over the counter and cash-back at the till. A shop in a neighboring village was ram raided when it installed a machine. We are staffed by volunteers who are mainly ladies of a certain age and we feel the risk is too great."
But at Oakington post office and stores in Cambridgeshire, the first to receive an ATM, postmistress Raj Sanghera said she was delighted with its success.
"A few customers have complained about the transaction fee, but overall people accept that there has to be a charge. I estimate it is used up to 25 times a day and it is bringing new business to my shop," she told the Telegraph.
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