The financial needs of consumers are ever-evolving, which has created both new challenges for financial institutions and new opportunities to meet them. Financial institutions continue to make enhancements to offer new channels to service their client base.
While consumers have more options than ever before, the branch continues to be a critical channel for consumers. Products and services are sold at a higher rate in the branch than any other channel. Given this reality, it is critical to enhance the overall branch experience while making it as efficient as possible.
Many financial institutions are evaluating the consolidation of their branches, which puts an increased burden on their remaining branches and can have a huge impact on branch staffing.
It can also lead to tellers experiencing increased manual, repetitive transactions, which can eventually cause employee dissatisfaction and turnover. On the other hand, consumers are often faced with longer teller wait times. All of this translates to operational inefficiencies and the need to make transactions more secure while elevating the consumer experience.
Most tellers want to develop new skills and grow in their careers versus spending time doing routine transactions like cashing checks. They want to develop stronger relationships with consumers and sell more services. That’s where a core-integrated self-service kiosk can be a game changer both in employee retention and consumer satisfaction.
Types of Self-Service Kiosks
There are three types of self-service kiosks:
- Automated Teller Machine (ATM)
- Interactive Teller Machine (ITM)
- Personal Teller Machine (PTM)
The market for each type is growing. According to Allied Market Research, the global ATM market (which includes ITM and PTM terminals) was valued at $20.8 billion in 2012. By 2027, the market is forecasted to reach $30.5 billion, equating to an annual growth rate of 5.2%.
Still, the differences between each type of kiosk are stark.
ATM: Basic Transactions, Outdated Technology
The first kiosk option is one you’re no doubt familiar with: the ATM. Launched in 1967, it’s the technology you use at your local branch, convenience store, or gas station to withdraw or deposit cash at any time of day.
ITM: Live Video Chats With Tellers, Some Advanced Transactions
The second type is an ITM, appearing as early as 2012, according to the Washington Post.
With an ITM, you have the option to push a kiosk button and start talking through a video screen to a live, remote teller at a call center. The call center can process more advanced transactions, apply payments to bills and loans, and answer questions. Some ITM solutions have the ability to open new accounts, provide information on financial products, and perform additional services.
PTM: True Self-Service for 85-95% of All Teller Transactions
The latest innovation is the PTM. Unveiled in 2015 by Source Technologies, these core-integrated self-service kiosks are placed inside the branch office. Shifting mundane transactions from a teller to a machine, these kiosks improve internal efficiencies, reduce overall expenses, and deliver consumers a personalized and modern retail experience.
Consumers can complete nearly all their financial transactions, including:
- Printing statements and temporary checks
- Printing official checks and money orders
- Cashing checks to the penny (PTMs dispense coins)
- Ordering check stock
- Paying bills or loans
- Transferring funds between accounts
- Withdrawing bills of various denominations
There are significant cost reductions by eliminating the need for a call center, and your in-house staff remains free to focus on higher-value, strategic tasks.
Why PTMs Are Especially Advantageous
All three types of these self-service kiosks (ATMs, ITMs, and PTMs) offer efficiency and customer and member service benefits for financial institutions.
A PTM offers significantly more advantages, including:
- Equipping the consumer to handle between 85% to 95% of the most common branch transactions, including cash and check deposit, multi-denomination cash accept/dispense, check cashing down to the penny, and official check and money order issuance. By contrast, the ATM typically only provides the ability to make a withdrawal or deposit.
- Allowing consumers to conduct transactions from their financial institution without having to wait for a traditional teller.
- Providing consumers with an advanced digital experience while decreasing expenses.
- Lowering unit and operational costs below ITM technology.
- PTMs are compact and easy to replace, whereas traditional ATMs can be larger and more cumbersome to manage.
- PTMs do not run on the ATM and ITM transaction rails, allowing financial institutions to avoid fees that are typical with ATM and ITM deployments.
Benefits of Implementing a Core-Integrated, Self-Service Kiosk
Another key advantage of a PTM is that the hardware and software connect directly into the financial institution’s core software. This connectivity isn’t trivial. The whole system has to work together, glitch-free, sending information back and forth smoothly.
Benefits of core integration include:
- No call center support required
- More transaction options
- Easier and faster technology upgrades
- Lower integration costs
This functionality opens the teller’s time to focus on serving consumers. They can now focus on building relationships, which can lead to making referrals for mortgages and car loans to help achieve cross-selling goals.
Ultimately, financial institutions can accelerate their internal processes and reduce mistakes while serving more consumers, more personally, in less time.
Where Are Financial Institutions Headed?
The future of financial institutions will continue to shift toward more use of PTM machines because of their ease and versatility of use, as well as time- and money-saving benefits. While there has been some shift toward “branchless” transactions, brick-and-mortar locations for financial institutions aren’t going away.
Not surprisingly, the COVID-19 pandemic also influenced the future direction of financial transactions in branch offices. In 2021, soon after the height of the pandemic, Novantas reported branch sales fell 15% versus pre-pandemic levels. Teller transactions dropped by 26%.
What all of this means is that change is rampant across financial institutions. Technology has taken center stage as the way to overcome challenges and make operations more economically prosperous. Expect PTMs to be one of the technologies used more often during this period of fundamental and widespread digital business transformation.
To learn more about core-integrated, self-service kiosks, contact Source Technologies.