What does the next decade hold for banks and related financial institutions? We know that big changes are coming. Our society is in a state of flux, especially when it comes to its relationships with money and technology.
You may be unsurprised, then, to learn that new technology for managing ATMs is a significant factor in shaping the industry. It’s driving some of the biggest changes taking place at the moment and is likely to have a big impact on the way that banking looks in 10 years’ time.
A picture in real time
Traditionally, one of the biggest challenges involved in ATM management has been predicting demand. This depends on monitoring activity over time, but when data takes a long time to come through, it can be difficult to get an accurate picture of events, and it’s very difficult to respond to changes in the short term.
With the new software that Perativ has been developing, ATM software solutions are increasingly focused on fast communication, with integrated networks of machines sending data back to HQ almost immediately. This makes it possible to look at what’s happening across the network in real time, making it much easier to ensure adequate supply and to adapt to unusual circumstances. In doing so, it also provides an additional measure of security and control in the event of a run on a bank.
Carrying less cash
Is cash still going to be relevant in the coming years? Some big thinkers claim that it’s disappearing, that we can pay for almost everything these days using cards or even our phones. However, this doesn’t work for everyone, and poorer people in particular still tend to find cash the easiest way to manage their affairs. What’s more, using less cash doesn’t mean that they cease to value quick and convenient access to cash when they do need it.
For banks, however, cash is expensive – the more so because of the margins necessary to ensure a steady supply when customers want it. By making it easier to predict demand and manage supply, the new generation of ATM software means that banks themselves can carry less cash, reducing overheads and streamlining the business model. This also has the potential to decrease the amount of security and insurance needed.
Keeping up with customers
Ultimately, the approach that a bank takes to managing its affairs has to keep up with the needs of its customers. With 61% of banking professionals questioned in a recent PWC survey stating that they considered a customer-centric business model to be ‘very important’, it’s clear that understanding what they want is vital.
New ATM software not only makes it easier to observe their behavior in real time, but also increases the range of options open to them, enhancing the way that they can interact with their account without having to visit a branch. Combined with internet and phone banking, this reduces the number of branches needed, significantly reducing costs. Research shows that customers want easy access to cash but that meeting a bank manager or teller in person is no longer a priority for them for the vast majority of their banking interactions.
AI to the rescue
With so much more data now available to banks and much less manual processing necessary, the emphasis has moved to data analysis for those wishing to capitalize on the changing situation. This runs up against human limitations – even the most skilled analysts can only handle so much information within a given timeframe. This has made the introduction of artificial intelligence more important than ever.
Properly integrated with ATM software, it can assess data as it arrives and make it easy for human analysts to draw out particular pieces of information, from the usage patterns of a particular machine to the types of interaction being carried out across a city within a specific time period. Using big data like this gives analysts a much richer understanding of customer behavior, and using AI also has the benefit of reducing the error rate, leading to better-informed decision-making at the top level.
As the industry adjusts to account for changing customer habits, it has never been more important to be flexible and well informed. New-generation ATM software provides a considerable advantage in both of these areas. It reduces costs, improves reaction times, lets banks take better advantage of the talents of their employees, and ultimately makes it possible to deliver a service that keeps customers much happier.