Moving ATMs Into the Future with Cash Recycling

The era of single-function ATMs is fading, making room for the rise of multifunction automated deposit terminals (ADTs), with an expected 8% growth in global deployment by 2026, despite a decline in overall ATM numbers. Leading this trend is the Asia-Pacific market, where 61% of ATMs in 2020 offered more than just cash withdrawals, compared to 34% in North America. Despite this shift, ATMs remain a popular banking channel, with 41% of consumers utilizing them for some banking needs, according to a September 2021 study by PYMNTS.

Financial institutions (FIs) are leveraging the transition to multifunction ADTs to introduce cash-recycling capabilities. The global deployment of cash-recycling ATMs surged from 973,000 in 2020 to over 1 million in 2021, and this figure is projected to surpass 1.2 million by 2026. Cash-recycling ATMs represent the fastest-growing segment in the global ATM market.

In its latest report, PYMNTS Intelligence delves into the rising adoption of cash-recycling ATMs and the potential advantages FIs can gain by incorporating recycling features into their new deployments.

Maximizing Efficiency with Cash-Recycling ATMs

As FIs embrace digital transformation, many are reevaluating their ATM fleets. This presents an opportune moment to reconsider the benefits of cash-recycling units. Historically, cost hindered the adoption of cash-recycling ATMs, but with more ATMs offering multiple functions, the cost gap has significantly narrowed.

Moreover, as FIs contemplate reducing their ATM networks, cash-recycling units offer a solution to mitigate cash-in-transit expenses associated with ATM maintenance. By consolidating cash deposits and withdrawals in a single cassette, cash-recycling ATMs can swiftly and securely handle banknotes, reducing the frequency of cash replenishment and easing the burden on FI staff. The projected average operational cost savings of cash-recycling ATMs, coupled with cash management software, stands at 20%. This efficiency gain is particularly valuable as many FIs downsize or close branches, alleviating the need for staff to manage ATM cash processing.

Cash-recycling ATMs also enhance security by minimizing cash movement, thereby reducing the risk of incidents during transit. Additionally, customers benefit from improved reliability, as cash shortages for withdrawals or full cassettes hindering deposits become less common. Coupled with the enhanced customer experience of modern multifunction ATMs, cash-recycling models are poised to become the most economical choice for future ATM deployments.

The Evolving Landscape of ATM Banking

With the shift towards online and mobile banking, self-service technologies bridge the gap between digital and physical banking channels. Cash-recycling ATMs offer FIs efficiency gains while maintaining physical touchpoints outside traditional branches. Customers also enjoy greater flexibility with denomination choices for withdrawals at these ATMs.

Small businesses stand to gain from cash-recycling ATMs, as they can conveniently make larger cash deposits outside of regular banking hours or at alternative locations. This is especially beneficial for businesses where the proprietor handles a significant portion of operations, minimizing the time spent on banking tasks and boosting profitability.

As FIs of all sizes seek to serve customers effectively through both physical and digital channels, cash-recycling ATMs present an opportunity to reduce costs, streamline deposit processing, and enhance overall customer satisfaction.