Access to cash is a staple requirement for today’s on-demand generation of consumers. Cash is still relied upon as an essential form of payment, accepted and exchanged in the most places, and always the last to be refused. The general public therefore, want to be safe in the knowledge that they are never too far away from access to our favoured notes. So much so, that we withdrew a total of £179.78 billion from Britain’s ATMs last year. 

But cash is no longer the only payment option. Today, consumers (myself included) want choice – the choice to use cash, card or any other digital payments that we feel like using at the time – such as digital wallets, Apple Pay, Android Pay etc…, and banks rapidly need to find ways to accommodate this demand. For example, while the British Retail Consortium found that cash still accounted for 42.3% of all transactions in 2016, this figure was almost 5% lower than the previous year, showing a gradual decline in the use of notes and coins.

Cash may be used in society less due to new and exciting options, but it is still being used, and will be for some time. The challenge for banks is to keep the cost of cash operations down as they continue to transform and modernise.

One way of doing this is by recycling cash – using notes that have been deposited at an ATM and then recycling them to make these available for customers to withdraw. This has significant benefits for financial institutions – saving time managing the cash and the associated operational costs.  

This can translate into huge financial benefits for banks. Currently, some financial institutions maintain as much as 40% too much cash in their ATMs and other figures show that where cash recycling is not in place, banks can spend an astounding 47.9% of their overall ATM network operating costs on cash management alone.

Although cash recycling sounds like an obvious choice for banks looking to reduce how much they spend on looking after their notes, most financial services are in the relatively early stages of uptake – and only around half of newly installed ATMs have recycling capabilities.

But, as financial institutions implement an increasing variety of alternative payment methods into their systems, managing the cost of cash will only become more important. So whether a customer wants to transact in cash, by contactless, via their phone, or using any other form of connected device, the onus is on banks to make sure they have the right service available to their customers at the right time - whilst also ensuring they have an economically viable cash management process in place for both current and future operations.