The Green Sheet Online Edition
April 14, 2008 • Issue 08:04:01
Advanced functions and the future
ATMIA Conference 2008 wound to a close last week [Feb. 22] in New Orleans. Long-time attendees and ATM Industry Association veterans said it marked the end of one of the association's best conferences, not only because of expected record-attendance numbers but also because of the show's theme and tone.
Mike Hudson, the former General Manager of NCR EasyPoint LLC who recently joined Australia-based Symstream Technologies as its Americas Vice President and Managing Director, said the show's timing and well-planned agenda likely pulled in a better crowd than previous years.
"I think the sessions attracted a lot of people, and I just think more people have time to focus on building their business than they have in the past," Hudson said. "This industry ebbs and flows.
"With all of the focus we've had on Triple DES and compliance and mandates, it's been hard for ATM companies to think about the future.
"Now, we've moved past that. Take a look around: There is so much energy, so much going on. People are showing off new equipment, new technologies, and the industry is excited about it."
Bill Dunn, Vice President of Sales for Tranax Technologies Inc., shared a similar sentiment. He said independent sales organizations in the ATM space are reaching and expanding their visions. They're trying new things, and they're hungry to learn how they can take their businesses from point A to point B in the 21st century.
"We have gotten a lot of interest in our check cashing system and our bill pay solutions," Dunn said. "This has been the best ATMIA show for attendees coming by our booth to look at what we're offering, and I think the reason is obvious. Why?
"Because there is a lot going on in the industry right now. There is a lot of competition, and those who are here want to see what is new and how they can differentiate themselves with new technology."
Dunn also said ATM ISOs are looking for solutions that will keep them in the cash business and offer opportunity to reshape the ATM business.
"I think we'll see more ATM ISOs maintaining control of their ATM networks," Dunn said. "And with more advanced functions, it's more or less a necessity."
Self-service bill payment is one such function. It's not something industry insiders merely talk about - many of them have deployed it in the field. It's proven technology, Dunn said. And check cashing, which involves a mix of self- and full-service, in Dunn's mind, will follow the same path of acceptance.
"The check cashing solution we have with Valid Systems is getting a lot of attention. Valid Systems knows this business, and what we're doing with them is not in beta - it's being used in the field right now. We're in selling mode."
The Valid-Tranax solution incorporates self-service with the teller, so the transaction time at the ATM is the same as a basic cash withdrawal.
The cashier or clerk scans the check and then prints a receipt for the customer. On the receipt is an ATM-transaction number, which the customer enters at the ATM, along with the amount of the check. And voilà: Cash is dispensed.
Though check cashing that includes a mix of self- and full-service might not be the golden ticket, said George McQuain, President and Chief Executive of Florida-based ISO Global Axcess Corp. (doing business as Nationwide Money Services), check cashing in some form at the ATM or kiosk likely is.
"Check cashing is something Global Axcess is closely reviewing," McQuain said. And now that the company is over the Triple DES hump, it's ready to reinvest in its business, he added.
"We've completed our Triple DES upgrades," McQuain said. "Now that we've made that investment and completed our upgrades, we're free to do more sales and to use our resources in other areas."
Most of GAXC's ATMs are in grocery stores and convenience stores - ideal venues for check cashing services, McQuain said. But the company hasn't made any moves, yet.
GAXC obviously is not alone in its interest. A Thursday presentation, hosted by Palm Desert National Bank's Electronic Banking Division, TIO Networks Corp., Valid Systems and the Center for Financial Services Innovation, left standing room only. The presentation, "Hybrid ATMs & Retail Revenue," was definitely a topic of interest.
"There is a change in the ATM industry," said Hamed Shahbazi, President and CEO of TIO Networks. "Dropping transaction volumes and industry pressures are forcing ATM players to explore other sources of revenue. They're getting excited about advanced functions, such as bill pay, and we're happy about that."
John Templer, the President and CEO of Valid Systems, said self-service check cashing is "finally" taking off.
"It's profitable for the retailer or c-store, and it's something we've been doing for a long time," he said. "We take a teller-assisted approach, but it really is just the first step." Tapping cash-preferred customers is the core interest, said Shahbazi, and it's an interest that is being fueled by a number of simultaneous influences.
ATM industry pressures, which have been rocking the industry's foundation for the last few years, are part of it. But so is the U.S. economic downturn.
"The economic downturn in the U.S. and the globe may push some consumers into that subprime category, and it's in that category that we find the cash-preferred," Shahbazi said. "Our terminals have had some of the best transaction volumes on record in the last few weeks, and we don't have a really good reason for it.
"I do think the economy could have something to do with it, and I expect our volumes to continue rising as we see more consumers moving into that cash-preferred category."
For years the industry has wrestled with the notion of advanced functionality, arguing that basic cash dispensing is the best option for the ATM.
But is that perspective changing?
"I think advanced functions are helping the [ATM] industry," Shahbazi said. "What we really need in this industry right now is innovation, and advanced functions will get us there. Interest in our product is picking up. For some, advanced-function hardware is too expensive. For others, they see it as a long-term investment."
All signs point to change. It's a time of rebuilding, most would say.
A new beginning
It's that perspective that made the conference's opening address, delivered by industry veteran J. Michael Brown, so fitting.
As Brown spent the better part of an hour sharing his gut-wrenching experience as a Katrina survivor in New Orleans during the days following Hurricane Katrina, the audience fell silent.
Soon, however, it became evident to those listening that ATMIA's theme for Conference 2008 - "Rising Again" - meshed well with the rebuilding of New Orleans, and that of the life of a local bank and trust's President and CEO.
Since his experience, Brown has made many changes, both personally and professionally.
The tragedy led him to identify new business opportunities for his bank, First Bank and Trust, that are helping build a stronger financial foundation for the future.
"Ultimately," Brown said, "the bank was not prepared for how bad the storm was going to be. We lost every branch except our branch in Baton Rouge.
"We didn't have the right software at the back-up site, and we didn't have a good plan in place. Now we have remote deposit capture, and it's a lesson we learned from Katrina. It's a wonderful technology that would have resolved a lot of our problems, had we had it in place then. We've learned from the experience, and we're better for it."
A glimpse from the floor
Wincor Nixdorf International showed off its new SlimCash, a "slimmed-down" version of the ProCash 1500 that's designed for off-premises deployments. The new ATM is being marketed in the United States for its ISO appeal, but it's also garnering attention from bankers, said Kevin Bienemann, Wincor Nixdorf USA's ISO Channel Sales Director.
"This show is not just ISOs. We've had people from U.S. Bank and PNC here expressing interest in this machine," he said. "Banks and ISOs are looking for more functionality for more revenue generation."
The SlimCash comes equipped with two cash cassettes, each holding up to 1,200 notes.
GRG Banking Equipment Co. Ltd., which expects 2008 to be its year for a big U.S. push, showed off its H22 TTW (through-the-wall) ATM. The company expects ISOs and financial institutions to take an interest in it. In China, GRG has about 30,000 H22 ATMs installed.
GRG is working with Global Cash Services, the new consulting company founded by former Triton heads Brian Kett, Bill Jackson and Jeff Barrow, to market its products in the States.
Triton Systems said it's sticking to the products the market wants; 2008 will be the year that the company spends perfecting and promoting its RL 2000 and FT 7000 lines.
"We think the RL 2000 is really a rebirth of what made Triton great with the 9600," said Triton's new CEO, Bill Johnson. "It will be the staple of our retail line."
The RL 2000 is touted for its standard 10-inch color monitor and SDD (single-denomination dispensing) mechanism.
"It's a reliable machine, like the FT 7000," which is designed for the FI space, Johnson said. "We're working to push the FT 7000 through our VARs [value-added resellers], and we have several hundred out in the field right now, in both the domestic market and internationally."
Nautilus Hyosung showed off its new MoniMax line, which it's now pushing in the market beyond the well-known Mini-Bank series.
"From here forward, MoniMax will comprise all of our ATMs except for the Mini-Bank 1500 and 1800," said Randal Lawrence, Nautilus Hyosung's new U.S. Marketing Manager.
The MoniMax 5300, which is expected to hit the market during the second half of the year, is designed to meet the needs of both the retail and banking markets. Equipped with a sidecar for advanced functions like check cashing and bill pay for the show, the 5300 comes with a standard 15-inch touch screen LCD and can hold up to 6,000 notes.
Also expected to soon hit the market is the Mini-Bank 1820, part of the 1800 series. It's a sleek Windows-based ATM that comes in at a price point comparable to the 1500, Lawrence said.
"We're pushing it to the retail market because of its small footprint and fresh design," he said. "I've heard our customers say retailers will like it because of how it blends in with the rest of the retail environment. It really does have a nice look."
Columbus Data Services said its self-service card dispensing program, which it announced last year through a deal with Tranax, is gaining attention in malls.
"We got off to a slow start, because self-service gift-card dispensing is something new for consumers," said Ron Schuldt, President of CDS. "But we're using a wrap now to tell users what they need to do to use the machine, and we expect that to make a big difference. There is interest out there; you just have to market it."
CDS has only deployed its card technology on the Tranax c4000, but Schuldt said the technology can be deployed on any Windows-based ATM or self-service terminal.
That said, where Schuldt expects his company to see the biggest growth in 2008 is through its payroll-card business, which is part of CDS's Pay N Go program.
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