Fifty per cent of US financial institutions want to channel their investment in customer relationship management to deliver more personalised services at the cash machine, according to a survey conducted by Dove Consulting on behalf of EFT networks Star, Pulse, Nyse and Co-op.
Almost six years after the introduction of surcharging caused a boom in ATM placement, the industry is returning to equilibrium, says Tony Hayes, a director with Boston-based Dove Consulting.
"In every sector, we found deployers in the midst of changing their ATM business strategies," says Hayes.
Large independent sales organisations (ISO) remain optimistic about new deployment opportunities and expect to nearly double their ATM fleets in the next two years. Petrol stations/neighbourhood stores will remain the most popular channel for retail ATM placements, followed by supermarkets, schools and shopping malls.
Banks, on the other hand, plan to rationalise their ATM fleets over the next two years, either by relocating poor performing terminals or by removing the ATM altogether. Credit unions, meanwhile, will continue to place incremental ATMs at a steady pace.
The study found location to be the single most important determinant of cash machine usage. In 2001, on-premises ATMs attracted 4479 transactions per month (on average) while off-premises ATMs operated by a financial institution yielded 1918 transactions per ATM per month. ISO terminals, on the other hand, generated an average of 600 transactions per month. Deployers expect these volumes to grow modestly over the next two years.
For the industry as a whole, the average surcharge for an off-premises cash withdrawal rose from $1.36 in 1998 to $1.48 in 2001, or about nine per cent. Hayes says some deployers can be expected to increase fees again in an attempt to produce greater income to offset their costs. "Consumers are relatively insensitive to changes in ATM fees," he says. "Based on deployers surveyed, a fee increase of $.50 caused only a modest decrease in transaction volumes."