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“ATM Innovation to 2020 and Beyond” by Mike Lee, CEO, ATMIA “ATMs: 50 Years of Innovation with a Big Future Ahead.” Loews Sapphire Falls Resort, Orlando, FL, USA February 15 th , 2017
“ATM Innovation to 2020 and Beyond”by Mike Lee, CEO, ATMIA
“ATMs: 50 Years of Innovation with a Big Future Ahead.”Loews Sapphire Falls Resort, Orlando, FL, USA
February 15th, 2017
Agenda
1. Icebreakers
2. By 2020….
3. Emerging industry trends
4. ATMs Today – a Position of Global Strength
5. The Future for ATMs
6. Conclusions
Icebreaker
Icebreaker – ATMs literally at the ends of the Earth!
Antarctica’s ATMs are located inside the US scientific community of McMurdo Station, near the South Pole.
By 2020…
25bn devices and appliances connected through the Internet of Things (IoT)
4 million ATMs Mobile internet will be dominant with over 70% penetration, and
app-based payments will equal browser-based payments for e-commerce (McKinsey)
The global payments pie will have grown its revenues 6% p.a. to 2020 to exceed $2 trillion USD, with intense competition from internet giants (Google, Amazon, PayPal, Alibaba, etc.), technology giants (Apple, Samsung, etc.), global card brands, big banks, independent service-providers, social media giants (Facebook, WeChat, Twitter) and major retailers and retail consortiums
By 2020…
NFC will be a dominant platform and technology enabler, with an estimated 2.2bn NFC-enabled phones
Many countries will have converted to faster payment systems
Cards will still be a dominant payment method but may be approaching “Peak Card” between 2020-2025
Currency in circulation will be growing globally at between 5-8% p.a.
There will be zero cashless societies in the world
Emerging industry trends
QuickEasyConvenientSecure
Cardless cash for the mobile-digital age Some banks plan to eliminate cards for ATM transactions due to
skimming, captured cards and other card data compromises Convenience of on-demand digital experiences like Amazon orders
and Uber point to need for frictionless technology experiences at ATMs, including faster, easier transactions with digital ATM receipts
Meetingconsumerswhere they are
Emerging industry trends
Digital wallet transactions at ATMs
Major banks are implementing NFC at US ATMs to enable wallets like Android Pay, Apple Pay and Samsung Pay to transact at ATMs
Deploy the 2nd (NFC) card reader at the ATM, with additional coding & messaging for recognition by Host as NFC transaction, as oppose to standard magstripe or EMV transaction, with different CVN cryptograms for each wallet provider
Card Network support to route on-us ATM Acquirer transactions for digital wallet transactions Visa and MC do not support OFF-US ATM Acquirer digital wallet transactions at this stage — but this is a question of when, not if
Some banks have created their own app, e.g. CashTap; app comes alive as approach ATM, tap phone on machine for cash dispense for both beacon and NFC range
Emerging industry trends
Meet Irving – the Headless ATM
No PIN pad
No card reader
No screen
NFC, QR code or biometric authentication
Fast cash – in under 10 seconds (Bolt's 9.58 seconds best is the world record for 100m), with current average ATM transaction is 42 seconds (according to Advertising Age)
Emerging industry trends
Where digital money meets
cash
Where the bank meets the customer
Where channels meet
Where the past meets the future
Where high-tech meets
the high street
The technological meeting point
http://www.dailysabah.com/feature/2015/08/31/blesh-turkeys-big-player-in-ibeacon-technology
Akbank bank app for an Apple Watch enables customers to access statements, locate nearest branch and draw cash from ATMs via SMS Pass or iBeacon.As you walk past an ATM,
the ATM detects you andtriggers your app: “An ATM is close, need some cash?”
Emerging industry trends
Emerging industry trends
Migrations to new operating systems for the 2020s: W10 2020 Roadmap Alternative operating systems for future ATMs Android Linux
WinCE 2023 Roadmap
Manufacturers are most likely to choose between Linux, Android, W10 & W10 IoT Core to shape the operating environment of ATMs for the post 2020 world.
Emerging industy trends
2020 Roadmap specifications complete, based on a recommendation to migrate from W7 to Windows 10 IoT Enterprise, awaiting vendor commitments and delivery dates for W10 pilots later in 2017.Study of alternative operating systems, covering growing interest
in the Linux open source system, with over 20% of ATMs in Brazil already on Linux and a major deployer in India selecting Linux, due to lower maintenance, and gearing up for a pilot phase. Android ATMs are also being extensively piloted. Industry RFI for Next Generation ATMs – a gift to the 50th
anniversary of ATMs.
Emerging industry trends
Studies on Cloud ATMs to gain a clearer picture of a future model of the ATM, including the whole software stack. Cloud ATMs 2 to analyse how the industry can migrate to the Cloud on a large scale and what standards might be needed for that to happen. Another goal would be to gauge interest levels among deployers, especially banks, across the world.
“Windows CE Positioning Paper”, has been published and a new Windows CE 2023 Committee group has begun to draw up a 2023 Roadmap for around 15% of world’s installed base.
Emerging Industry Trends – US payments 2016
Paper checks still account for trillions of dollars of consumer payments yearly in the USA – a 2016 study by Tremont Capital for ATMIA estimates checks will account for 7.5 billion consumer payments in 2018.A very small percentage of US consumers actually use mobile
payments frequently today; there is no mass adoption of the technology as yet.Cash is still the most used form of payment for US consumers.Cash as a percentage of total transactions is slowly declining as the
total consumer payment pool expands, but the study estimates cash accounts for 45% of payments by volume of transactions in 2016.
Emerging Industry Trends
Mobile access, i.e. cardless
Digital receipts (text or email)
Interactive table-top touchscreen for cheque imaging, ID scanning, & document signing
Video teller access
Privacy panels
Single-slot cash interface
Great locations!
Ease of access & simplicity of use!
Global ubiquity!
High trust levels!
High security levels and best practices!
Transformed from Automated Teller to Value-Added Touchpoint!
Part of branch transformation!
Part of omnichannel banking!
Cross channel friendly!
ATMs Today – a Position of Global Strength
Growth in ATM installations forecast to be 37% between 2014-2020, to reach 4
million ATMs by 2020 (Global ATM and Market Forecasts to 2020, RBR)
A new ATM is installed every 2 mins, 47 seconds! (source: RBR)
Number of cash withdrawals grew 10% in 2015, up from 7% in 2014 & are
forecast to grow 40% between 2014-2020, increasing from 92 bn withdrawals to
128 bn by 2020 (Source: RBR)
99 billion cash withdrawals made worldwide in 2015 (Source: RBR)
Potential growth of banked population with 2 bn still unbanked, including about
38% of adults – financial inclusion will drive up global ATM usage
ATMs Today – a Position of Global Strength
Increased added-value services in addition to its 5 core functions,
advanced ATMs can handle 200 + types of transactions
Global cash demand is high – grew at 8.9% y-o-y during 2009-2013,
more than double the GDP rate
Card friendly but ready for the cardless future!
Deposit automation – 31% of ATMs worldwide include automated
deposit functionality (ADTs); automated deposit and recycling ATMs
make up 40% of global shipments (RBR) – wave of growth predicted
for cash recycling
Ready for digital wallet transactions!
ATMs Today – a Position of Global Strength
The Future for ATMs
Drivers of our future : Mobile internet The Cloud
Mobile payments: P2P payments, Contactless transactions, m-commerce NFC
Role of cash as trusted public money Reconfiguration of branch and ATM
Real-time payment systems for faster payments Customer experience for the connected digital consumer
Financial inclusion Environmental impacts
The Future for ATMs
The Future for ATMs
The future of the ATM depends on consumer trust, cash demand and continued technological evolution as a customer touchpointCash has a long past and a long future
Uber Cash
The Future for ATMs
“Cash plays a dominant role for small-value transactions, is the leading payment instrument for many types of purchases, and stands as the key alternative when other options are not available.” “Cash Continues to Play a Key Role in Consumer Spending :Evidence from the Diary of Consumer Payment Choice” Cash Product Office, Federal Reserve, April 2014
Over 50 years after this media “announcement” of cash’s demise, cash remains the world’s most used payment method!
www.cashrepository.com
1963 comedy film “The Man from the Diner’s Club”starring Danny Kaye
ATMIA is seeing a “great disconnect” in many advanced economies between declining cash transactions and increasing value of cash in circulation.
The Future for ATMs
“From young markets with large unbanked
populations, to the most sophisticated where
consumers can choose from an increasingly wide
array of banking channels, the ATM remains a vital
touchpoint between banks and their customers.”
Dominic Hirsch, Managing Director, RBR (October 2015)
The Future for ATMs
“ATMs have become far more than machines that
dispense cash. They are portals into a full array of
technologies that let people bank anytime and
anywhere. ATMs are now at the forefront of omni-
channel technologies that are redefining the digital
economy.”Bill Nuti, CEO, NCR (2016)
The Future for ATMs
The underlying power of the ATM Adaptable - the ATM has survived decades of competing technologies and
has ended up absorbing them, welcoming the technologies, from the credit card to the smart phone, and enabling them to be used at the ATM
Persistent demand for cash Ubiquity Value-add services Critical customer touchpoint in an era of bank closures, in which the ATM
can do virtually everything the bank branch can do, and at a much lower cost Future-ready - ready for cardless, for the Cloud, for channel integration, for
mobile integration, for consumer convenience, for digital currency and for the Internet of Things
2017 will celebrate the 50th anniversary of the ATM:
Can we even imagine a world without ATMs?
There’s no current plausible scenario for a world without ATMs.
The ATM has successfully reinvented itself for its next phase of
development in the faster, more mobile world of tomorrow.
Conclusions : 50 years of the ATM
