Auriga Atm Futuretrends 2015 Final

ATM Future Trends
2015
CONTE NTS
Page 3 Executive Summary Page 66 Bold (and not so bold) predictions for
Branch transformation the future of retail ATM
Cyberattack Daryl Cornell, CEO, Triton Systems
Mobile wallet
Bitcoin Page 68 Connecting with customers through
ATM innovation
Page 8 U.S. Consumer Survey Results Alicia Moore, head of Wells Fargo ATM Banking

Page 21 India Consumer Survey Results Page 70 ATM trends in mature and emerging markets
Leland Englebardt, group head of network
Page 37 Industry Survey Results solutions, MasterCard
Page 45 Mobile technology: Page 72 About the sponsors

An opportunity, not a threat, for ATM owners
Steven Rathgaber, CEO, Cardtronics
Page 48 The ticking time bomb: Interest rate rises

Brendan Doyle, CEO, Cash Management
Solutions
Tiffany Smith, custom content editor
Page 50 More is better: Multilayered protection against tiffanys@networldmediagroup.com
persistent security threats
Frank A. Natoli, Jr., executive vice president James Bickers, editorial director
jamesb@networldmediagroup.com
and chief innovation officer, Diebold, Inc.
Suzanne Cluckey, senior editor, ATM Marketplace
Page 52 Legislative and regulatory predictions for suzannec@networldmediagroup.com
the payment industry
Kurt Helwig, president and CEO, Electronic
Funds Transfer Association
Page 55 The future of ATM technology Alan Fryrear, chairman

Mike Lee, CEO, ATMIA alanf@networldmediagroup.com
Tom Harper, president & CEO
Page 58 ATM future trends report offers macro, tomh@networldmediagroup.com
micro market insights Kathy Doyle, executive vice president and publisher
Vincenzo Fiore, CEO, Auriga kathyd@networldmediagroup.com
Page 60 Trends reflect IADs and FIs need to keep

abreast of market demands
Andy Orent, CEO, Nautilus Hyosung
ATM Future Trends 2015 2015 Networld Media Group.
13100 Eastpoint Park Blvd.,
Page 63 Taking action around the branch of the future Louisville KY 40223. (502) 241-7545
Brian Bailey, vice president of marketing and All rights reserved. No part of this publication may be reproduced without the
strategy, NCR Financial Services express written approval of the publisher. Viewpoints of the contributors and editors
are their own and do not necessarily represent the viewpoints of the publisher.
2015 NETWORLD MEDIA GROUP 2

E X ECUTI V E S U M M A RY
Welcome to ATM Marketplace ATM Future Trends 2015, a tri-annual look
at the competitive, economic and technologic forces shaping (or you might
Suzanne Cluckey
say reshaping) the ATM industry.
editor,
Were pleased to have the sponsorship of Auriga behind this, our fourth ATM Marketplace
edition of the guide, which allows us to make a valuable resource available
industry-wide at no cost.
Were also pleased to incorporate end-user opinions into the report for the
first time with the inclusion of consumer data from two polls: one in the ma-
ture North American market and one in the fast-developing Indian market.
In some cases, we found consumer sentiment in both markets to be

remarkably similar:
How important is it to you to have access to a fee-free ATM?
US consumers
48% 37%
11%
2% 3%
Essential Very important Somewhat Not that I don't care
important important
Indian consumers
48% 41%
8%
3% 0%
important important

And in other cases, strikingly divergent:
Is it more important to you to have an ATM nearby, or a branch nearby?
US consumers Indian consumers
Neither, I do my Neither, I do my banking

Neither, I do my 2% Neither, I do my banking
banking online
1% using a mobile app
banking online using a mobile app
8%
8%
Branch
9%
ATM
43%
Branch
47%
ATM
82%
We also found that the expectations and objectives of consumers and

providers dont always stack up the same way:
In five years, which of the following will be the most popular trend in serving
cash-preferred consumers?
Consumers
5%
12% Offering prepaid-card dispense at the ATM
or other self-service channel
Reaching out to digital natives, those who
grew up with digital and mobile technology
52% 13%
FIs, independent deployers and retailers partnering
to reach unbanked and underbanked consumers
Advanced self-service solutions, such as
bill payment and check cashing
18%
Deploying solutions that integrate mobile-banking
and marketing with the self-service channel

Which of the following services would you most like to see at the ATM?
(please select three)
Providers
Bill payment at the ATM 61%

Cash withdrawals in multiple denominations 56%
Real-time transactions (e.g. instant credit to account on deposits) 46%
Check cashing at the ATM 42%
Personal preference setup (withdrawal amounts, balance display, etc.) 39%
Cardless cash withdrawal using mobile app 33%
Prepaid card sales 27%
Email receipt 26%
Event ticket sales 21%
Virtual currency exchange (i.e. Bitcoin, Altcoin, Dogecoin, etc.) 19%
We hope that, in providing these types of insights, ATM Future Trends 2015
will serve as one more useful tool in the box as you work to formulate a
business strategy that is sound, durable and responsive to consumer pref-
erences and the rapid pace of change in digital financial services.
To understand the importance of this in todays market, simply consider

these current topics that were, at most, faint blips on the radar when we
published the ATM Future Trends Report 2012:
Branch transformation
This trend was only beginning to emerge in 2012, and received only a
passing mention in that years report. The reinvented branch has gained
momentum steadily in the past three years and is now at the center of the
discussion about the future of retail banking.
This self-service model has been propelled by the development of ad-

vanced hardware teller cash recyclers, video teller machines, cash-

recycling ATMs and the sophisticated software that not only drives them,
but also serves as link to tablet-equipped staff no longer tied to a teller desk
and computer monitor.
FIs are seeing this new technology as a way to reduce the branch footprint,
realize cost-efficiencies in staffing and operations, and redirect staff time
from teller functions that create cost to sales functions that generate rev-
enue and reinforce customer loyalty.
Cyberattack
In the 2012 report, two-thirds of ATM deployers named ATM security/regula-
tory compliance as their No. 1 trending concern. But criminals have since
demonstrated that advanced security devices and regulatory compliance
are not the whole answer.
This has been underscored by an increase in ATM cashing-out or jackpot-

ting. There are several variants on this type of attack, but the common
denominator is the introduction of undetectable malware onto a machine
via physical access to its hard drive. This allows the criminal to send cash-
dispense commands, emptying the machines vault.
In another computer exploit, cybercriminals stole masses of prepaid card

numbers from a providers database and, further, removed the spending
limits on those cards. A coordinated global ATM cash-out using counterfeit
cards netted the well-organized gang $47 million.
Mobile wallet
By 2009, financial institutions were seriously considering the potential in
mobile banking. In that years future trends report, 35 percent of respon-
dents said that deploying solutions that integrate mobile banking and
marketing with the self-service channel would be the most popular trend
over the next five years. At the time, though, there was little certainty about
just how this might work.
By 2012, the notion of prestaging a cash withdrawal through a banking app

was just dawning on ATM operators and so was the realization that a
virtual debit card could move from said banking app into a mobile wallet,
risking disintermediation between bank and customer if that wallet carried
another providers brand.

Bitcoin
Introduced in 2009, the cryptocurrency was a non-issue for the financial
services industry three years ago. In fact, the terms bitcoin, and crypto-
currency did not appear in the 2012 report at all.
At that time, we had no bitcoin ATMs, no foreign remittances via virtual

currency, no questions about government regulation of a problematically
anonymous payment instrument unless you meant cash.
Now we have all of these things and the questions that go with them. Will
bitcoin replace cash? Improbable. Should ATM deployers consider adding
bitcoin functionality to their fleet, or alternatively, investing in bitcoin ATMs?
Perhaps well have an answer for that by the time we get to the 2018 re-
port. And, we hope, well see how well the trends indicated in the 2015 end
up serving the interests of the ATM industry and its end user.

U.S. CO N S U M E R
Note: Not all data will add up to 100% due to rounding
S U RV E Y R E S U LT S
1. What is your age? 2. Where are you?
65 and over
1%
55-64 18-24
14% 15%
US
100%
45-54
20% 25-34
25%
35-44
26%
3. What is your gender? 4. What is your annual household income?
Over $150,000
$100,001 - $150,000 3%
10%
Less than
51% 49% $25,000
$75,001 - 23%
$100,000
12%
$50,001 -
$75,000
21% $25,000 - $50,000
31%
U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 8

5. Which of the following services would you most like to see at the ATM? (please select three)
Cash withdrawals in multiple denominations (not just $20 bills) 64%

Email receipt 28%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Prepaid card sales 30% 19% 17% 15% 8%
Event ticket sales 21% 20% 23% 13% 9%
Virtual currency exchange
(i.e. Bitcoin, Altcoin, Dogecoin, etc.) 17% 16% 11% 5% 4%
Cardless cash withdrawal using mobile app 24% 19% 24% 17% 6%
Bill payment at the ATM 31% 30% 31% 25% 18%
Check cashing at the ATM 57% 55% 37% 38% 36%
Real-time transactions 30% 46% 45% 32% 23%

(e.g. instant credit to account on deposits)
Personal preference setup 22% 23% 25% 17% 19%
(withdrawal amounts, balance display, etc.)
Email receipt 27% 29% 35% 25% 22%
Cash withdrawals in multiple denominations 54% 71% 66% 64% 62%
(not just $20 bills)

(continued)
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
Prepaid card sales 20% 15% 19% 17% 19% 13%
Event ticket sales 18% 14% 25% 17% 23% 0%
(i.e. Bitcoin, Altcoin, Dogecoin, etc.) 9% 8% 18% 13% 8% 6%
Cardless cash withdrawal using mobile app 12% 16% 23% 28% 21% 25%
Bill payment at the ATM 30% 26% 26% 25% 40% 6%
Check cashing at the ATM 47% 46% 44% 36% 51% 19%
Real-time transactions
(e.g. instant credit to account on deposits) 30% 43% 38% 38% 38% 31%
Personal preference setup 19% 22% 17% 32% 23% 25%

Email receipt 27% 29% 28% 38% 17% 38%
Cash withdrawals in multiple denominations
(not just $20 bills) 62% 74% 60% 62% 51% 56%
BY GENDER
FEMALE MALE
Prepaid card sales 11% 25%
Event ticket sales 16% 20%
(i.e. Bitcoin, Altcoin, Dogecoin, etc.) 7% 15%
Cardless cash withdrawal using mobile app 13% 24%

Bill payment at the ATM 27% 28%
Check cashing at the ATM 45% 44%
(e.g. instant credit to account on deposits) 39% 36%
Personal preference setup 21% 22%

Email receipt 26% 31%
Cash withdrawals in multiple denominations
(not just $20 bills) 73% 55%

6. Are you carrying more or less cash these days?
52%
32%
11%
5%
Less About the same More I never carry cash
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
More 11% 13% 11% 10% 10%
Less 51% 50% 54% 58% 42%
About the same 32% 32% 28% 29% 42%
I never carry cash 6% 5% 6% 4% 5%
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
More 7% 10% 15% 15% 13% 6%
Less 59% 58% 52% 39% 38% 31%
About the same 28% 30% 28% 36% 43% 50%
I never carry cash 6% 2% 5% 10% 6% 13%
BY GENDER
FEMALE MALE
More 9% 14%
Less 54% 50%
About the same 31% 33%
I never carry cash 7% 4%

7. Are you making more purchases with cash due to data breaches at stores?
Yes
34%
No
66%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
YES 42% 34% 30% 38% 30%
NO 58% 66% 70% 62% 71%
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
YES 39% 33% 36% 38% 26% 19%
NO 61% 67% 64% 62% 74% 81%
BY GENDER
61%
40%
71%
29%

8. If breaches continue or get worse, how likely are you to switch to cash?
15%
22% 22% I denitely will switch for all but the most expensive purchases
34% Ill use cash more often, but mostly for smaller purchases
29% 29% Ill start thinking about it very seriously
15% Ill still use cards; my bank covers any fraud,

34% so it doesnt really affect me
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
I definitely will switch for all but the most expensive purchases 31% 26% 16% 20% 19%
Ill use cash more often, but mostly for smaller purchases 35% 33% 35% 35% 31%
Ill start thinking about it very seriously 26% 30% 30% 32% 26%
Ill still use cards; my bank covers any fraud, so it doesnt really affect me 9% 11% 20% 12% 24%
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
I definitely will switch for all but the most expensive purchases 27% 21% 25% 22% 11% 13%
Ill use cash more often, but mostly for smaller purchases 34% 37% 29% 35% 34% 19%
Ill start thinking about it very seriously 26% 28% 29% 39% 34% 19%
Ill still use cards; my bank covers any fraud,
so it doesnt really affect me 13% 14% 17% 4% 21% 50%
BY GENDER
FEMALE MALE
I definitely will switch for all but the most expensive purchases 21% 24%
Ill use cash more often, but mostly for smaller purchases 36% 31%
Ill start thinking about it very seriously 30% 28%
Ill still use cards; my bank covers any fraud, so it doesnt really affect me 13% 17%

9. How important is it to you to have access to a fee-free ATM?
48% 37%
11%
2% 3%
important important
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Essential 49% 51% 48% 47% 40%
Very important 27% 36% 41% 41% 33%
Somewhat important 16% 8% 10% 10% 14%
Not that important 3% 2% 0% 1% 6%
I dont care 5% 3% 1% 2% 6%
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
Essential 49% 47% 50% 52% 38% 38%
Very important 35% 37% 37% 36% 47% 13%
Somewhat important 11% 10% 10% 10% 13% 25%
Not that important 1% 3% 1% 1% 0% 13%
I dont care 5% 3% 2% 0% 2% 13%
BY GENDER
FEMALE MALE
Essential 54% 41%
Very important 34% 39%
Somewhat important 9% 12%
Not that important 1% 3%
I dont care 2% 4%

10. If you had the option to go to a teller window or do the same transaction at a drive-up video ATM
with a remote teller, which would you choose?
Video teller
37%
Bank branch
63%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Bank branch 70% 55% 61% 66% 73%
Video teller 30% 45% 39% 34% 27%
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
Bank branch 70% 63% 65% 62% 57% 25%
Video teller 30% 37% 35% 38% 43% 75%
BY GENDER
37% 37%
63% 64%

11. Do you worry about someone using a skimming device to steal your card information
and PIN when youre using the ATM?
5%
10% Yes, Im very concerned about it
Im aware of the possibility, but not that concerned

38% I never even think about it
Whats a skimming device?

46%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Yes, Im very concerned about it 40% 34% 37% 43% 40%
Im aware of the possibility, but not that concerned 46% 50% 46% 46% 42%
I never even think about it 7% 9% 13% 5% 14%
Whats a skimming device? 7% 7% 4% 5% 4%
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
Yes, Im very concerned about it 38% 37% 44% 42% 30% 25%
Im aware of the possibility, but not that concerned 46% 46% 43% 48% 53% 50%
I never even think about it 8% 11% 9% 7% 15% 13%
Whats a skimming device? 9% 5% 4% 3% 2% 13%
BY GENDER
FEMALE MALE
Yes, Im very concerned about it 37% 40%
Im aware of the possibility, but not that concerned 47% 46%
I never even think about it 11% 9%
Whats a skimming device? 5% 6%

12. How important is it to you to have an ATM available nearby for cash access?
11%
Very important;
I dont want to have to go out of my way to get cash
Sort of important; I dont mind going a little out of my way
Doesnt matter; I never use the ATM anyhow

52%
37%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Very important;
I dont want to have to go out of my way to get cash 43% 57% 54% 58% 40%
Sort of important; I dont mind going a little out of my way 47% 34% 37% 36% 31%
Doesnt matter; I never use the ATM anyhow 10% 9% 9% 6% 30%
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
Very important;
I dont want to have to go out of my way to get cash 50% 55% 56% 54% 43% 25%
Sort of important; I dont mind going a little out of my way 33% 35% 34% 41% 51% 38%
Doesnt matter; I never use the ATM anyhow 17% 9% 10% 6% 6% 38%
BY GENDER
FEMALE MALE
Very important;
I dont want to have to go out of my way to get cash 51% 53%
Sort of important; I dont mind going a little out of my way 36% 38%
Doesnt matter; I never use the ATM anyhow 13% 10%

13. Does the US have:
57%
17% 17%
9%
Too many ATMs Enough ATMs Not enough ATMs Not enough
ATMs that can
do more than just
dispense cash
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Too many ATMs 9% 9% 11% 4% 18%
Enough ATMs 58% 49% 59% 62% 58%
Not enough ATMs 15% 24% 18% 13% 13%
Not enough ATMs that can do 19% 19% 12% 21% 12%
more than just dispense cash
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
Too many ATMs 9% 9% 11% 4% 9% 25%
Enough ATMs 43% 61% 54% 70% 66% 50%
Not enough ATMs 21% 16% 18% 17% 11% 19%
Not enough ATMs that can do 26% 15% 17% 9% 13% 6%
BY GENDER
FEMALE MALE
Too many ATMs 8% 11%
Enough ATMs 52% 61%
Not enough ATMs 20% 15%
Not enough ATMs that can do 21% 13%

14. Do you think an EMV smart card (an ATM card with a computer chip in it)
will make your ATM transactions more secure?
It will make them

absolutely secure
BY GENDER
FEMALE MALE
I don't know
14%
what that is It will make them absolutely secure 13% 14%
It won't make much
difference; criminals 15% It will help a lot 30% 36%
defeat the 15% It will help some 20% 25%
technology
It wont make much difference; criminals
It will help a lot will find a way to defeat the technology 17% 13%
It will help some
33%
23% I dont know what that is 19% 11%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
It will make them absolutely secure 16% 16% 13% 11% 14%
It will help a lot 20% 30% 36% 40% 39%
It will help some 25% 26% 27% 21% 9%
It wont make much difference; criminals 16% 17%
will find a way to defeat the technology 12% 14% 17%
I dont know what that is 24% 11% 13% 14% 22%
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
It will make them absolutely secure 18% 12% 15% 15% 9% 6%
It will help a lot 27% 36% 27% 41% 42% 38%
It will help some 18% 21% 26% 26% 26% 25%
will find a way to defeat the technology 19% 14% 20% 12% 6% 0%
I dont know what that is 19% 17% 12% 7% 17% 31%

15. Is it more important to you to have an ATM nearby, or a branch nearby?
Neither, I do my 2% Neither, I do my banking

banking online using a mobile app
8%
ATM
43%
Branch
47%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
ATM 46% 51% 48% 33% 31%
Branch 41% 38% 44% 59% 56%
Neither, I do my banking online 9% 8% 5% 8% 13%
Neither, I do my banking using a mobile app 5% 3% 4% 0% 0%
BY HOUSEHOLD INCOME
< $25K $25-50K $50-75K $75-100K $100-150K > $150K
ATM 42% 43% 44% 46% 38% 38%
Branch 43% 47% 51% 44% 53% 31%
Neither, I do my banking online 11% 7% 4% 9% 9% 13%
Neither, I do my banking using a mobile app 4% 2% 0% 1% 0% 19%
BY GENDER
FEMALE MALE
ATM 42% 44%
Branch 48% 46%
Neither, I do my banking online 8% 8%
Neither, I do my banking using a mobile app 3% 2%

I NDIA CO N S U M E R
Note: Not all data will add up to 100% due to rounding
S U RV E Y R E S U LT S
1. What is your age? 2. Where are you?
55-64
18-24
13% 17%
45-54
13%
25-34
19%
India
100%
35-44
38%
3. What is your gender? 4. What is your annual household income?
Less than 15,000 INR

15,001 - 30,000 INR
7%
5% 30,001 - 50,000 INR
6%
49% 52% 50,001 - 70,000 INR
7%
More than 70,001 -
150,000 INR 100,000 INR
50% 11%
100,001 -
150,000 INR
15%
INDIA CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 21

5. Are you carrying more or less cash these days?
55%
23%
19%
4%
Less About the same More I never carry cash
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
More 14% 25% 19% 18% 14%
Less 52% 50% 60% 48% 56%
About the same 26% 22% 19% 31% 25%
I never carry cash 7% 3% 3% 3% 5%
BY HOUSEHOLD INCOME
< 15,000 INR 15,001-30,000 30,001-50,000 50,001-70,000 70,001-100,000 100,001-150,000 >150,000 INR
More 6% 4% 10% 14% 37% 23% 18%
Less 53% 71% 60% 54% 44% 49% 57%
About the same 24% 25% 23% 26% 19% 24% 23%
I never carry cash 18% 0% 7% 6% 0% 4% 2%
BY GENDER
FEMALE MALE
More 20% 17%
Less 52% 57%
About the same 24% 23%
I never carry cash 4% 4%

6. Is it more important to you to have an ATM nearby, or a branch nearby?
Neither, I do my Neither, I do my banking

banking online
1% using a mobile app
8%
Branch
9%
ATM
82%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
ATM 79% 86% 86% 78% 77%
Branch 7% 4% 9% 12% 16%
Neither, I do my banking online 12% 10% 4% 10% 8%
Neither, I do my banking using a mobile app 2% 0% 1% 0% 0%
BY HOUSEHOLD INCOME Less than 15,001- 30,001- 50,001- 70,001- 100,001- More than
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
ATM 74% 92% 60% 83% 86% 87% 83%
Branch 18% 4% 27% 6% 11% 4% 8%
Neither, I do my banking online 6% 4% 10% 11% 2% 10% 9%
Neither, I do my banking using a mobile app 3% 0% 3% 0% 2% 0% 1%
BY GENDER
FEMALE MALE
ATM 82% 82%
Branch 10% 8%
Neither, I do my banking online 7% 9%
Neither, I do my banking using a mobile app 1% 1%

7. If you had the option to go to a teller window or do the same transaction at a drive-up video ATM
with a remote teller, which would you choose?
Video teller Bank branch

50% 50%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Bank branch 54% 58% 48% 42% 45%
Video teller 46% 42% 52% 58% 55%
BY HOUSEHOLD INCOME
Less than 15,001- 30,001- 50,001- 70,001- 100,001- More than
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
Bank branch 65% 63% 63% 57% 68% 54% 38%
Video teller 35% 38% 37% 43% 32% 46% 62%
BY GENDER
51% 49% 49% 51%

8. Complete the following sentence: The ATM I use is ...
Often inoperable
or out of cash
8%
Always operable
and stocked
Usually operable with cash
and stocked
with cash
55%
37%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Always operable and stocked with cash 57% 59% 62% 45% 41%
Usually operable and stocked with cash 32% 35% 32% 49% 50%
Often inoperable or out of cash 11% 6% 7% 6% 9%
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
Always operable and stocked with cash 38% 63% 57% 51% 65% 68% 52%
Usually operable and stocked with cash 41% 25% 43% 34% 30% 28% 41%
Often inoperable or out of cash 21% 13% 0% 14% 5% 4% 7%
BY GENDER
FEMALE MALE
Always operable and stocked with cash 56% 55%
Usually operable and stocked with cash 36% 38%
Often inoperable or out of cash 9% 7%

9. How physically safe do you feel when you use the ATM to get cash?
68%
27%
5%
Very; I don't worry Not very safe at all;
about my physical I often worry about
safety at all being physically
assaulted and robbed
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Very; I dont worry about my physical safety at all 29% 32% 27% 25% 19%
Mostly safe, but I definitely keep a lookout 64% 66% 66% 70% 77%
Not very safe at all; I often worry about being
physically assaulted and robbed 7% 2% 7% 5% 5%
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
Very; I dont worry about my physical safety at all 27% 38% 30% 29% 28% 32% 24%
Mostly safe, but I definitely keep a lookout 62% 58% 57% 63% 72% 65% 71%
physically assaulted and robbed 12% 4% 13% 9% 0% 3% 5%
BY GENDER
FEMALE MALE
Very; I dont worry about my physical safety at all 25% 29%
Mostly safe, but I definitely keep a lookout 69% 67%
physically assaulted and robbed 6% 5%

10. What would make you feel safer using the ATM? (select all that apply)
72% 67%
56% 52%
36%
A working video Having a young and Having the ATM in a Mirrors on the ATM so Adding more or
camera at the ATM capable guard on duty location that's clearly that I can see what's better lighting
visible to passers-by, going on behind me
thus scaring off any
miscreants
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Having a young and capable guard on duty 70% 67% 74% 60% 50%
Adding more or better lighting 23% 33% 46% 40% 25%
Mirrors on the ATM so that I can see whats going on behind me 45% 48% 59% 52% 52%
A working video camera at the ATM 67% 73% 73% 74% 75%
Having the ATM in a location thats clearly visible
to passers-by, thus scaring off any miscreants 35% 58% 60% 68% 58%
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
Having a young and capable guard on duty 68% 60% 57% 56% 61% 74% 69%
Adding more or better lighting 20% 33% 33% 24% 34% 34% 41%
Mirrors on the ATM so that I can see whats going on behind me 40% 60% 57% 64% 46% 46% 54%
A working video camera at the ATM 68% 67% 76% 68% 63% 70% 76%
to passers-by, thus scaring off any miscreants 48% 53% 43% 64% 27% 52% 65%

10. What would make you feel safer using the ATM? (select all that apply)
(continued)
BY GENDER
FEMALE MALE
Having a young and capable guard on duty 64% 70%
Adding more or better lighting 37% 35%
Mirrors on the ATM so that I can see whats going on behind me 57% 48%
A working video camera at the ATM 74% 71%
to passers-by, thus scaring off any miscreants 56% 56%

11. How important is it to you to have access to a fee-free ATM?
48% 41%
8%
3% 0%
important important
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Essential 37% 54% 53% 46% 42%
Very important 52% 35% 38% 45% 41%
Somewhat important 10% 8% 7% 6% 9%
Not that important 1% 1% 3% 3% 8%
I dont care 0% 2% 0% 0% 0%
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
Essential 35% 29% 53% 43% 37% 64% 50%
Very important 41% 50% 37% 43% 54% 34% 39%
Somewhat important 21% 17% 7% 9% 7% 3% 7%
Not that important 3% 4% 3% 6% 0% 0% 4%
I dont care 0% 0% 0% 0% 2% 0% 0%
BY GENDER
FEMALE MALE
Essential 52% 45%
Very important 38% 44%
Somewhat important 9% 7%
Not that important 2% 3%
I dont care 0% 1%

12. When you use the ATM, how long would you estimate that you have to wait in line?
47%
22%
18%
6% 5%
2% 0%
No wait 1-2 minutes 3-5 minutes 6-10 11-15 16-30 More than
minutes minutes minutes 30 minutes
13. Would you say that this is:
Much too much time
8%
More time
than Id like,
BY GENDER
but I can FEMALE MALE
live with it
Not too much time 64% 65%
28% Not too
much time
More time than Id like, but I can live with it 28% 28%
64%
Much too much time 9% 7%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Not too much time 57% 62% 65% 64% 75%
More time than Id like, but I can live with it 41% 29% 24% 28% 20%
Much too much time 2% 9% 11% 8% 5%
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
Not too much time 62% 63% 70% 71% 53% 66% 65%
More time than Id like, but I can live with it 32% 38% 27% 26% 28% 26% 28%
Much too much time 6% 0% 3% 3% 19% 8% 8%

14. Do you worry about criminals stealing your card data and PIN by
installing a card skimming device on the ATM?
What's a
I never even skimming device?
think about it
4% 3%
I'm aware of
the possibility,
but not that
concerned
29%
Yes, I'm very
concerned about it
64%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Yes, Im very concerned about it 58% 68% 69% 63% 53%
Im aware of the possibility, but not that concerned 29% 24% 26% 31% 44%
I never even think about it 6% 5% 4% 3% 2%
Whats a skimming device? 7% 3% 2% 3% 2%
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
Yes, Im very concerned about it 32% 54% 70% 74% 75% 70% 63%
Im aware of the possibility, but not that concerned 35% 25% 27% 26% 25% 23% 32%
I never even think about it 12% 21% 3% 0% 0% 1% 4%
Whats a skimming device? 21% 0% 0% 0% 0% 5% 2%
BY GENDER
FEMALE MALE
Yes, Im very concerned about it 68% 61%
Im aware of the possibility, but not that concerned 28% 30%
I never even think about it 2% 6%
Whats a skimming device? 2% 3%

15. Do you think an EMV smart card (an ATM card with a computer chip in it)
will make your ATM transactions more secure?
It won't make much I don't know

difference; criminals what that is
BY GENDER
defeat the technology FEMALE MALE
8%
5%
It will make them absolutely secure 44% 33%
It will help some
8% It will make them It will help a lot 38% 45%
absolutely secure
38% It will help some 7% 9%
will find a way to defeat the technology 5% 5%
It will help a lot I dont know what that is 7% 8%

42%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
It will make them absolutely secure 30% 49% 40% 37% 30%
It will help a lot 39% 32% 42% 48% 55%
It will help some 17% 8% 7% 2% 2%
It wont make much difference; criminals 2%
will find a way to defeat the technology 6% 4% 6% 8%
I dont know what that is 12% 5% 7% 8% 6%
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
It will make them absolutely secure 29% 33% 47% 31% 39% 50% 37%
It will help a lot 32% 42% 40% 46% 40% 34% 45%
It will help some 9% 8% 10% 3% 14% 5% 7%
will find a way to defeat the technology 9% 4% 0% 9% 2% 8% 4%
I dont know what that is 21% 13% 3% 11% 5% 3% 7%


Cash withdrawals in multiple denominations 56%
Email receipt 26%
BY AGE GROUP
18-24 25-34 35-44 45-54 55-64
Prepaid card sales 33% 34% 27% 18% 22%
Event ticket sales 19% 26% 21% 15% 20%
(i.e. Bitcoin, Altcoin, Dogecoin, etc.) 20% 26% 22% 9% 8%
Cardless cash withdrawal using mobile app 33% 35% 31% 33% 36%
Bill payment at the ATM 50% 67% 62% 61% 64%
Check cashing at the ATM 35% 38% 46% 48% 42%
Real-time transactions 32% 44% 47% 58% 50%

(e.g. instant credit to account on deposits)
Personal preference setup 32% 31% 40% 46% 48%
Email receipt 31% 30% 25% 22% 20%
Cash withdrawals in multiple denominations 42% 51% 59% 67% 59%

(continued)
15,000 INR 30,000 50,000 70,000 100,000 150,000 150,000 INR
Prepaid card sales 21% 33% 17% 26% 44% 28% 25%
Event ticket sales 12% 13% 17% 23% 35% 19% 20%
(i.e. Bitcoin, Altcoin, Dogecoin, etc.) 9% 8% 17% 26% 23% 19% 19%
Cardless cash withdrawal using mobile app 32% 17% 30% 43% 32% 30% 35%
Bill payment at the ATM 50% 46% 50% 46% 60% 60% 69%
Check cashing at the ATM 24% 38% 47% 34% 56% 37% 44%
(e.g. instant credit to account on deposits) 27% 17% 30% 54% 33% 37% 57%
Personal preference setup 24% 17% 23% 40% 33% 35% 47%
Email receipt 24% 29% 23% 20% 19% 19% 30%
Cash withdrawals in multiple denominations 32% 29% 60% 51% 49% 46% 66%
BY GENDER
FEMALE MALE
Prepaid card sales 23% 32%
Event ticket sales 19% 22%
(i.e. Bitcoin, Altcoin, Dogecoin, etc.) 19% 18%
Cardless cash withdrawal using mobile app 31% 35%

Bill payment at the ATM 66% 57%
Check cashing at the ATM 48% 37%
(e.g. instant credit to account on deposits) 47% 44%
Personal preference setup 38% 40%

Email receipt 27% 25%
Cash withdrawals in multiple denominations 58% 53%

17. Please choose the number of times you visit each of these in an average month.
More than 10
Zero visits
7-10 2%
3% 1%
4-6 Zero visits More
6% 17%
than 10 1-3
16% 24%
7-10
25%
4-6
1-3
71% 33%
Bank Branch ATM
BY AGE GROUP
Zero More Zero More

Age 18-24 visits 1-3 4-6 7-10 than 10 Age 25-34 visits 1-3 4-6 7-10 than 10
Bank branch 17% 74% 5% 2% 2% Bank branch 20% 70% 3% 3% 4%
ATM 1% 22% 28% 28% 22% ATM 0% 24% 26% 26% 25%
Zero More Zero More

Age 35-44 visits 1-3 4-6 7-10 than 10 Age 45-54 visits 1-3 4-6 7-10 than 10
ATM 1% 20% 36% 28% 16% ATM 0% 32% 41% 20% 8%
Zero More
Age 55-64 visits 1-3 4-6 7-10 than 10
Bank branch 16% 77% 3% 2% 3%
ATM 7% 34% 33% 21% 5%

17. Please choose the number of times you visit each of these in an average month.
(continued)
BY HOUSEHOLD INCOME
Less than Zero More 15,001- Zero More

15,000 INR visits 1-3 4-6 7-10 than 10 30,000 INR visits 1-3 4-6 7-10 than 10
ATM 12% 39% 30% 3% 15% ATM 4% 29% 46% 13% 8%
30,001- Zero More 50,001- Zero More

ATM 0% 30% 20% 23% 27% ATM 0% 32% 27% 32% 9%
70,001- Zero More 100,001- Zero More

ATM 0% 24% 38% 26% 13% ATM 0% 20% 27% 31% 22%
More than Zero More

150,000 INR visits 1-3 4-6 7-10 than 10
Bank branch 20% 71% 5% 3% 2%
ATM 0% 21% 35% 27% 16%
BY GENDER
Zero More Zero More

Female visits 1-3 4-6 7-10 than 10 Male visits 1-3 4-6 7-10 than 10
ATM 2% 27% 36% 22% 14% ATM 1% 22% 30% 29% 19%

I N DU STRY S U RV E Y R E S U LT S
1. What is your industry segment?
10% FI, less than $500 million in assets
7% FI, $500 million to $1 billion in assets
3%
19% FI, $1 billion to $500 billion in assets
2% 13% 10% 4% IAD deploying 1 to 25 ATMs
1% 7% 2% IAD deploying 26 to 100 ATMs
3% IAD deploying 101 to 500 ATMs
5% 5% IAD deploying 501 to 1500 ATMs
6% IAD deploying more than 1500 ATMs
19%
13% 6% Processor
3% EFT network
13% ATM manufacturer
4% 4%
6% ATM parts provider
6% 4% 1% ATM service company
3% 2% ATM software provider
2% 3% Consultant
3%
13% Other
2. In which region is your company based?
Central/Eastern Europe
North America
Western Europe 9%
45% 12%
Middle East
Central America 4%
Africa Asia Pacific
2% 4% 18%
South America
5%
INDUSTRY SURVEY RESULTS ATM FUTURE TRENDS 2015 37

3. What is your position?
Entry-level employee 3%
Other 5%
Consultant 6%
CEO 6%
Project manager 7%
Owner/operator 7%
IT professional 11%
Mid-level executive 12%
Senior-level executive 12%
Senior-level manager 15%
Mid-level manager 17%
4. Over the next five years, which of the following do you believe will have the greatest impact
on the global ATM industry?
2% 1%
2% 2% 46% Mobile technology
2%
15% Branch transformation
10% Cash recycling
3% 5% Interchange reduction
4% 4% More technology/equipment to protect cardholder PINs
4% 4% Government regulations
4% 4% Other (please specify)

46% 3% Changes to ATM surcharges
5%
2% Self-service software upgrades and patches
Working with outside vendors on PCI compliance
10% 2% standards, such as the Data Security Standard
2% Virtual currencies
15% 2% Movement of ATMs to virtual private networks (VPNs)
1% Deployment of more Windows-based ATMs
Other includes: EMV, multivendor software

5. In five years, which of the following will be the most popular trend in serving cash-preferred consumers?
5%
12% Offering prepaid-card dispense at the ATM
or other self-service channel
Reaching out to digital natives, those who
grew up with digital and mobile technology
52% 13%
FIs, independent deployers and retailers partnering
to reach unbanked and underbanked consumers
Advanced self-service solutions, such as
bill payment and check cashing
18%
Deploying solutions that integrate mobile-banking
and marketing with the self-service channel
6. In the next five years, what do you see as the top three threats facing the ATM industry in your region?
Online transactions 2%
Lack of innovation 2%
Competition 2%
EMV - slow upgrade 3%
Cashless transactions 3%
Technology advancements and costs 4%
ATM attacks/robbery 5%
Virtual currencies 5%
Government regulations 8%
Cost of ownership 9%
Mobile banking 13%
Security/fraud/data breaches 17%
Other 26%
Other includes: Apply Pay, prepaid cards, decline in interchange fees, loss of consumer confidence

7. Do you see the regulatory environment as predominantly positive for the continued
growth of the ATM industry?
No
49% Yes
51%
8. In the NORTH AMERICAN ATM market, what are the three ATM industry trends most
likely to impact the market over the next five years? (choose three)
Mag-stripe to EMV chip conversions 67%

Mobile integration 57%
Branch transformation with self-service or
interactive banking machine emphasis 40%
Security standards and other compliance issues 39%
Cash Recycling 25%
Video banking/remote teller technology 22%
Deposit imaging at the ATM 15%
North America
Industry consolidation 15%
Supplier adoption of new technologies/functionality 13%
Open software architecture 11%
Other 4%
Other includes: Self-service technology, saturation of market

9. In the EUROPEAN ATM market, what are the three ATM industry trends most likely
to impact the market over the next five years? (choose three)

Security/EMV 39%
Cash-in and recycling at the ATM 34%
Cost reduction 28%
Outsourcing of ATM networks 26%
Video banking/remote teller technology 20% Europe
Uniform hardware guidelines and compliance 14%
Other 6%
Other includes: Currency exchange, multivendor solutions
10. In the ASIAN ATM market, what are the three ATM industry trends most likely to
impact the market over the next five years? (choose three)

Security/EMV 51%
The emergence of IADs 30%
Cost reduction 28%
Asia
Other 5%
Other includes: Increased market saturation

11. In the MIDDLE EASTERN ATM market, what are the three ATM industry trends most
likely to impact the market over the next five years? (choose three)

Security/EMV 60%
Middle Eastern
Cost reduction
25%
Other 3%
12. In the AFRICAN ATM market, what are the three ATM industry trends most likely
to impact the market over the next five years? (choose three)
Security/EMV 60%
Cost reduction 40%
African
Other 8%
Other includes: Lower energy consumption ATMs, oppressive business models

13. In five years, what region or country will be considered the most popular deployment
market in terms of new or replacement installations?
United
Kingdom Central and Russia
North America 2% Eastern Europe 1%
Western Europe 5% Other
20% 5% (Asia, Japan
and Spain)
Middle East China
4%
3% India 27%
Africa 15%
Central and South America
10%
6%
Australia and New Zealand
3%
14. In five years, what percentage of successfully 15. Do you think surcharging will become more
completed ATM transactions will NOT be prevalent in markets outside North America within
cash withdrawals? the next five years?
Less than 10%

6%
Roughly 10%
8%
Unsure
18%
More than 30%
27% Yes
40%
10% to 20% Will stay

27% the same
23%
20% to 30%
No
32%
19%

16. What percentage of U.S. ATM deployers will be 17. To what extent will financial institutions outsource
EMV-compliant when the final liability shift their ATM operations all or in part by 2017?
occurs in the American market in 2017?
Will probably decline
Less than 10% 2%
6%
More than 75% Unsure

Common, but
17% 10-25%
14% not pervasive
16% 27%
A dominant
trend
50-75% 27%
29%
25-50%
32% Practiced by some
31%

I N DU S TRY I N S IG HT
Mobile technology:
An opportunity, not a
threat, for ATM owners Steven Rathgaber
CEO, Cardtronics
Steven Rathgaber is chief executive officer
Maybe youve heard this one before: Whats the role of ATMs going for- of Houston-based Cardtronics, which works
ward, especially in a payments environment that many say is becoming with retailers, financial institutions and
increasingly less reliant on cash? prepaid card programs to make ATM cash
access convenient where people shop,
I answer that question by first acknowledging that there are myths in pay- work and live their lives. Cardtronics owns/
ments lots of myths. Take, for example, the myth that millennials are operates more than 52,800 retail ATMs in
the United States and international locales,
forsaking cash. Another, even more outrageous myth is that cash is go-
including Canada, Mexico, the Caribbean
ing away altogether. After all, the storyline goes, as mobile payments gain and United Kingdom.
steam, they are preparing to completely remake the payments experience
killing the use of cash in the process.
Well, what if I told you consumers arent looking for the payment experience
to be remade?
Cash use still strong even among millennials

Despite access to a variety of payment methods, plenty of consumers con-
tinue to prefer cash for reasons such as budgeting, security or perhaps sim-
ply the feeling of having a little spending money in their pockets. In a 2014
report, Federal Reserve data found cash at 40 percent of all consumer
transaction activity to be the most used retail payment instrument.
Ready for the real myth buster? A diverse group of consumers, particularly
younger consumers, prefer and use cash. Also according to the Fed data,
40 percent of 18- to 24-year-olds prefer cash, the highest percentage of
any age group demonstrating that cash continues to play a fundamental
role in payments, even for the digitally savvy younger generation.
Cash doomsayers are looking at the payments industry from a limited view-
point. Theyre focused on the technology, not the consumer. Consumers

have shown us time and time again that when you provide a service they
value, they come and they use it.
The real opportunity offered by mobile technology

Now, that said, just because consumers arent looking for the payment
experience to be remade doesnt mean that smartphones, retailer loyalty
apps and mobile payments arent changing the game for ATM owners and
operators. And respondents to the ATM Future Trends Survey 2015 agree,
overwhelmingly selecting mobile technology as having the greatest poten-
tial impact on the global ATM industry.
New technology can help us realize an environment in which ATMs are

even more valuable to the consumer, beyond being convenient access
points for cash.
Consider this: Consumers are increasingly aware of and frustrated by the

fees they pay. Even in an era of increasing convenience for the consumer,
many banks still charge a foreign fee to their customers when they use
retail ATMs.
If fees reduce the convenience factor of a retail ATM, then the question be-
comes how to make the ATM either more cost effective or otherwise more
valuable to the consumer as a part of a holistic experience.
By taking full advantage of opportunities offered by mobile devices and

location services technology, for example, we can enable the consumer to
find a surcharge-free ATM based on their current geographical location.
Or, we as an industry can enable ATM-exclusive promotions in-store

discounts, links to retailer loyalty programs and digital coupons delivered
to the mobile phone. Aided by mobile technology, the ATM can be central
to deeper engagement in the environment where the ATM user is choosing
convenient access to cash.
Bullish on cash and changing technology

In addition to surcharge-free solutions like Allpoint, Cardtronics is focused
increasingly on creating mobile-enabled connections for our retailer part-
ners. Its about making the ATM fee a moot point because, for example,
using the ATM unlocked $10 worth of savings for a consumer, extending the
machines value to that user.
People withdraw cash from ATMs in the United States billions of times each

year. Its easy to do, its convenient and it serves a basic need. But, we
cant be lulled into believing that so long as consumer demand for cash
remains healthy conveniently located retail ATMs dont need to change.
Mobile technology offers us one way to serve consumers better than ever,
strengthening our connection to them and our value to our retailer and
financial institution partners.

The ticking time bomb:
Interest rate rises Brendan Doyle
It might not feel like it sometimes, but low interest rates have created a CEO, Cash Management
benign operating environment for the cash industry. As interest rates will Solutions
inevitably rise, the years ahead will not be so easy. While the pace and Brendan Doyle is CEO of Cash
magnitude of rises remain unknown, failure to prepare now could see many Management Solutions. He has more than
ATM deployers struggle. 20 years experience providing consultancy
in the cash industry, and has worked with
ATM deployers and financial institutions
The impact of rising rates
of all sizes in 20 countries, helping them
This benign operating environment isnt just about a reduced cost of holding to reduce their costs of cash management
cash. Low interest rates have also created two additional positive outcomes. and improve their operational efficiencies.
Brendan founded CMS in 1991 following
Firstly, by encouraging cash hoarding, low interest rates have underpinned receipt of his MBA at Manchester Business
cash demand, with cash in circulation rising by 6 percent to 10 percent per School in the U.K., and a career at the
Royal Bank of Scotland.
year in many Western economies.
This has helped create a false confidence in cash. We forecast that, going
forward, demand for notes will be negatively affected as higher interest
rates reduce the incentive to hoard cash and alternative payment technolo-
gies continue to gather momentum.
Secondly, low interest rates have created spare capacity in the armored
transport industry. Low interest rates reduce the need for visits, as more
cash can be held in an ATM at lower cost.
Spare capacity has resulted in lower prices and higher service quality. As
interest rates rise, there will be an incentive to schedule more visits and
this will lead to higher prices, at least in the short term, until more capacity
comes on stream.
Therefore, our concerns are that even small increases in rates could lead to
potentially devastating effects as businesses are caught in a pincer move-
ment between lower income and higher costs.
Watch the Fed

All eyes are on Federal Reserve Chair Janet Yellen for hints as to when
the Fed will push the button and increase interest rates. Positive U.S.

economic data through 2014 points toward a Fed strategy over the first six
months of 2015 that will culminate with an initial rise in the federal funds
rate halfway through the year.
There is, however, one factor that could derail this: inflation. Inflation is still
below the Feds target of 2 percent and has shown no signs of reaching
it. Traditionally, while inflation is low, rates should remain low, but the Fed
seems prepared to go against this and trigger a rise mid-2015, regardless
of the inflation rate.
Further to the timing of the initial rate rise, the increase in magnitude of in-
terest rates will have a big impact on the ATM industry. When interest rates
do rise, there is little consensus from Fed members as to the appropriate
level to be set from 2015 or beyond.
In the September 2014 Federal Open Market Committee meeting, par-

ticipants selected a federal funds rate target for the end of 2015 ranging
between the current level of 0.25 percent* to as high as 3.0 percent.
A hike to 3.0 percent might not sound considerable, relative to long-term

rates, but it will see underlying interest rise by a factor of 12, resulting in
increased costs for ATM deployers in the obtaining, transporting and hold-
ing of cash.
Dealing with rising interest rates

In a higher rate environment, strategies for survival will include a drive for
economies of scale, and we can expect further consolidation within the ATM
and wider cash industries.
All businesses will need intelligent and innovative strategies to survive. First
and foremost is a need to stress test your operating model against higher
costs of holding and moving cash.
In stress testing analysis that we have conducted for several ATM deploy-
ers, the results have shown that deployers profits are disproportionately
affected. By conducting these tests, deployers obtain simulated results that
they can use to prepare for future rate rises or, indeed, other threats
before they materialize.
Rising interest rates pose an existential threat. I urge deployers not to under-
estimate the potential impact of this trend on their business and the industry.
*At the time of writing Dec. 10, 2014

More is better:
Multilayered protection Frank A. Natoli Jr.
executive vice president
against persistent and chief innovation
officer, Diebold Inc.
security threats Frank A. Natoli Jr., was appointed executive

vice president and chief innovation officer
for Diebold Inc. in January 2012.He leads
the global product and supply chain
Far too frequently, the report of another data breach hits the news cycle.
organizations, with oversight of Diebolds
And these thefts are expanding in scope, with recent breaches boasting global technology, product management,
some of the largest data hauls ever recorded. engineering, procurement, supply chain,
The prevalence of retail and commercial business breaches accounting and manufacturing groups. Before joining
Diebold in 2005, Frank spent 23 years in
for nearly one-third of all data breaches recorded in 2014, according to the
the automotive industry in engineering,
Identity Theft Resource Center has the potential to influence consumers manufacturing and operations roles. He
point-of-sale payment methods, in addition to consumer trust. received a bachelors degree in mechanical
Not surprisingly, nearly 56 percent of U.S. consumers surveyed for the engineering and a masters degree at
Kettering University.
2015 ATM Future Trends Report said theyd shift to using cash more fre-
quently if breaches continue or get worse, with another 29 percent saying
theyd start thinking about it very seriously.
Increased demand for cash as a payment method would likely be sated at
the ATM. But ATMs, like point-of-sale devices, face their own threats from
attacks that attempt to compromise data by tapping into hard drives, ma-
nipulating back-end systems or installing skimming devices.
High among institutions concerns is skimming-related fraud. According to
McAfee Security, this method accounts for 30 percent of all data fraud, and
results in more than $2 billion in losses annually.
But combating skimming as well as trapping, fishing, malware and physi-
cal attacks starts with multiple layers of protection.
As card-skimming fraud increases in prevalence and sophistication around
the world, the need for a new grade of anti-skimming ATM security solution
has never been more pronounced. This year, Diebold announced the
ActivEdge anti-skimming solution, which counteracts every known form
of skimming.

Current skimming technology relies on the ability to read the entire mag-
netic stripe on a card as it is inserted short-end first into the ATM. ActivEdge
accepts cards long-edge first, making it impossible for a skimmer to capture
the card information.
The technology also provides fully encrypted card-reading and data com-
munication and gate-locking functionality to counteract card trapping and
fishing; and reporting that delivers troubleshooting and service diagnostics,
and generates forensic data and log files.
Newer malware threats that require access to an ATMs interior can be
mitigated with layered protection. Using the ATMs physical security sensors
to detect unauthorized access to the computer can address any issues via
real-time monitoring services.
In addition, a computing platform that includes communication encryption,
trusted device pairing, and trusted boot technologies makes logical pen-
etration extremely difficult.
And finally, real-time operating system and antivirus software management
services help to ensure that every ATM is protected from the latest malware
threats within minutes of a software update being issued.
To combat physical ATM attacks, real-time ATM monitoring provides a layer
of protection that identifies an attempted breach the moment it occurs.
Integrating advanced sensors and alarms into ATMs aids in prompt detec-
tion and reporting of attacks, and monitoring platforms can enable remote
investigations and immediate corrective actions including remotely shut-
ting down a terminal.
Piling on the layers of protection allows financial institutions to more ef-
fectively monitor for, identify and mitigate expanding threats to the ATM
channel, including terminal hacks, cutting-edge skimming devices and
sophisticated malware.
By adopting a multilayered security approach, institutions will provide a
more secure self-service channel for consumers and help elevate ATM
security for the industry as a whole and restore consumer trust.
The industry itself needs to work in earnest as it has begun to do with
the recent formation of the ATM Security Association to identify threats,
share mitigation strategies and develop solutions for enhancing ATM secu-
rity around the globe.

Legislative and
regulatory predictions Kurt Helwig
president and CEO,
for the payment industry Electronic Funds
Transfer Association
Kurt Helwig is president and CEO of the
For an organization that seeks to advance electronic payments and com- Electronic Funds Transfer Association, an
merce, the next few years may well provide the opportunity for considerable inter-industry trade organization dedicated
action in the payments space from both the public and private sectors. to the advancement of electronic payment
systems and commerce in the United States.
Republican control of Congress could mean a less adversarial and more He is a regular advisor to executive agencies
business-oriented approach to payments regulation. Beyond symbolic within the government on payment systems
votes, Republicans need to demonstrate that they are able to govern and issues, and has testified numerous times
get bills passed through both chambers. Doing so will put the pressure on before House and Senate committees.
the president to either sign or veto any such legislation. Kurt is a founding member and co-chair
of the ATM Industry Association Global
However, payments will continue to receive considerable attention from Government Relations Committee and
executive agencies like the CFPB where there tends to be a more heavily serves on the ATMIA board of directors.
prescriptive regulatory approach. While portrayed as consumer friendly,
such an approach can often mean higher costs, reduced access and less
innovation. Here are a few areas to consider:
Regulatory
Operation Choke Point
Republicans will continue their assault on Operation Choke Point in con-
junction with several federal consumer protection and banking regulatory
agencies and the Federal Deposit Insurance Corporation to hold acquirer
financial institutions and their payment processor partners responsible for
allegedly illegal acts committed by merchants and other third-party payees.
Congressman Blaine Luetkemeyer will likely reintroduce his bill to limit the
scope and reach of OCP. This could lead to hearings to highlight perceived
and documented abuses of the program. We might also see legislative at-
tempts to defund the program. We await the results of the FDIC inspector
generals investigation into that agencys role in OCP.
Additional efforts by new House Oversight Committee Chair Jason Chaf-
fetz, will examine OCP issues at both DOJ and FDIC. The oversight com-
mittee will continue to subpoena emails from department officials on this is-

sue following the oversight committee staff report, Department of Justices
Operation Choke Point: Illegally Choking Off Legitimate Businesses?
which came out in late July.
Faster payment initiative
The Federal Reserve has finally released its long-awaited report, Strate-
gies for Improving the U.S. Payment System, which presents a multifac-
eted plan for collaborating with payment system stakeholders to enhance
the speed, safety and efficiency of the U.S. payment system. Now it will be
incumbent upon the industry to collaborate with the Fed as it seeks to move
the payments system to a near real-time settlement environment.
Legislative
In 2014 there was bipartisan support for cybersecurity and data breach legis-
lation. There may now be enough support for such legislation that a bill could
end up on the presidents desk. The president could also issue further execu-
tive orders on this issue as data breaches continue to make headlines.
Mobile payments
Innovation in mobile payments has sparked interest with the Consumer
Financial Protection Bureau. Last summer, EFTA responded to a request for
information from the CFPB seeking ways in which mobile payment technolo-
gies can be used to bring more people into the financial services mainstream.
EFTAs response indicated ways in which this is currently being achieved
and what can be done in the future to further facilitate this laudable goal.
The response warned that an onerous regulatory approach could stifle in-
novation and work contrary to the goal.
In 2014, House Financial Services held a hearing on how technology can
promote financial literacy. The hearing featured EFTA members who testi-
fied about the benefits that mobile applications bring to consumers.
The House Financial Services Committee and Senate Banking Committee
are likely to hold more hearings on these issues to address new and excit-
ing developments in mobile payment technology.
Virtual currency
With the development of bitcoin and other digital currencies, EFTA contin-
ues to monitor regulatory developments at both the state and federal level.
On Dec. 16, 2014, the Conference of State Bank Supervisors released their
policy report, State of Virtual Currency Regulation.
In this report, the CSBS Emerging Payments Task Force investigated the
intersection of state laws and the budding digital currency phenomenon. The

task force identified consumer protection, market stability and law enforce-
ment as areas of concern raised by the unregulated use of virtual currencies.
However, the CSBS noted that existing regulations can be applied success-
fully to cover companies and services using virtual currency; furthermore,
they emphasized that their proposed state virtual currency regulation would
not limit noncurrency uses of block chain technology. Federal regulation
from both FinCEN and CFPB seems likely in this area since it continues to
gain strong interest from consumers.
As a result, various congressional committees including House and Senate
Homeland Security, House Financial Services, Senate Banking, and both
House and Senate Oversight and Investigations will likely hold hearings to
examine the issue.
Dodd-Frank and the Consumer Financial Protection Bureau
The Republican-led Congress will continue efforts that we saw in the re-
cently passed omnibus spending bill to chip away at aspects of Dodd-Frank
legislation. This will likely include attempts to amend the form and structure
of the CFPB to make it more accountable to Congress.
Democrats will just as likely fight such efforts, but Republicans could attach
requirements to a bill that enjoys bipartisan support in order to realize the
changes they seek. The president may well veto any legislation that funda-
mentally alters the CFPB.
The next few years could have a significant impact on the payments and
broader financial industry, and could illustrate that Congress is indeed ca-
pable of passing legislation again.

The future of
ATM technology Mike Lee
CEO, ATMIA
Recently, Ive detected a growing appetite in our industry for learning more
about the future of the ATM. The future, after all, does directly influence Mike Lee is CEO of the ATM Industry
investment choices, strategies, planning and business confidence. Association, a nonprofit trade association
with more than 1,100 members in about 50
For example, the 2014 ATMIA member survey showed that the top two countries. He also is founder of the Global
issues our members want the association to focus on are, firstly, ATM secu- ATM Security Alliance, and is a qualified
rity and, secondly, the future of the ATM. futurist with an MPhil degree in Futures
Studies (cum laude) from the University of
Regarding the future, we should take heart from the continuing growth of
Stellenbosch business school in Cape Town.
the total payments market, in which the ATM plays such a key role. Dominic
Hirsch, managing director of RBR, hit the nail on the head when he wrote,
The total number of payments is increasing, which means that payment
methods are not so much cannibalizing each other, but evolving in their
own way.
Our industry is embracing the future like never before. For example, we
are powering ahead with the development of a 2020 industry roadmap for
migrating to the next mainstream ATM operating system, well in advance of
the end of support for Windows 7.
Not only has a 2020 migration cost model already been made available by
ATMIA for deployers to help them calculate the most cost-effective strategy,
but alternative, non-Microsoft operating systems are being piloted for viabil-
ity for future ATM migrations.
In other words, our industrys planning horizons for both software and hard-
ware upgrades have expanded significantly since the end of support for
Windows XP earlier this year. There are clear signs that the ATM industry is
becoming increasingly proactive and future-oriented.
This growing appetite for understanding and investing in the future direction
of our industry is one reason why the 2015 Future Trends Report from ATM
Marketplace is a timely and valuable document.
In addition, ATM technology itself has begun its leap into the future, so
readers can use the study to keep an eye on trends and stay abreast of
new killer apps and emerging value-adding functions and services.

The ATM will remain the most important public face of channel banking
for a long time to come. There is even a brand new sector in our industry,
which is likely to increase considerably in 2015: the rise of bitcoin ATMs.
Bitcoin ATM manufacturers are looking to extend their functionality in the
future to be card-accepting. Technology Strategies International reported in
their The Future of Virtual Currencies 2014 study that there are more
than 100,000 merchants accepting virtual currencies, (of which there are
about 700 active digital currencies). The study estimated bitcoins market
capitalization at about $5 billion, accounting for more than 90 percent of the
total, with only Ripple and Litecoin, of the other virtual currencies, having
total values of more than $100 million. I find it fascinating that there is a
strong demand from owners of virtual currency to convert some of it into
good old hard cash through bitcoin ATMs.
In fact, the popularity of cash amongst a tech-savvy public everywhere
remains strong and resilient, despite the proliferation of different payment
methods and customer-owned devices for mobile and online transactions,
as well as growth in cards.
The August 2014 edition of RBRs Banking Automation Bulletin (issue 327)
reported there were 10.8 billion payment cards in circulation at the end of
2013 (an increase of 11 percent from 2012). Nevertheless, the bulletin also
pointed out that cash remains king even in mature, advanced countries
such as the U.K., which sees about 20 billion cash payments made a year,
or 50 percent of all payments, and the U.S., where cash is used for half of
all transactions under $50.
The most recent study by the Federal Reserve Banks of Boston, Richmond
and San Francisco found that cash is still the top choice for payments in the
country, accounting for 40 percent of transactions in October 2012, while
debit and credit cards accounted for 25 percent and 17 percent, respective-
ly (from Reports of the Death of Cash Are Premature, Wall Street Journal,
Dec. 2, 2014).
Despite the continued global popularity of cash, some authorities, whether
governments or central banks, are trying artificially to end the reign of cash,
which would dent freedom of choice in payments for their citizens. Conse-
quently, ATMIA Europe has formed a Payments Choice 2020 committee to
formulate and oversee the implementation of plans aimed at maintaining
payment choice throughout Europe.
I mentioned that our industry has begun a leap into the future. I would back
a big future for cardless ATM transactions. Heres what ATMIA USA Execu-
tive Director David Tente, argues:

I think cardless may be the biggest trend. It is the ultimate convenience for
the consumer. There is simmering discontent over abusive network rules
and increasing fees, adding more fuel for the fire. It also facilitates the de-
velopment of payment options that may be added to the ATM channel.
David reasons correctly that the rising interest in ATM biometrics will further
strengthen the shift to cardless.
Ron Delnevo, executive director for ATMIA Europe agrees, seeing PIN
and cards gradually becoming redundant with growing demand for NFC
contactless at ATMs. An added benefit of contactless is that it removes the
threat of card skimming, still the No. 1 type of fraud in our industry. Smart
phones can now communicate directly with ATMs, rendering plastic cards
unnecessary for initiating transactions.
He is also sanguine about the future of cash-recycling ATMs, pointing out
that 100 percent of new ATM installations in Japan are cash recyclers.
In Europe, I am told, Germany leads the way, with around 20 percent of
ATMs offering this facility. This German figure is growing, Delnevo said.
Delnevo believes that cash recycling, along with increased merchant cash
replenishment, which ATMIA Europe is promoting, can keep the costs of
cash highly competitive, and keep access to cash for citizens as wide-
spread as possible even in an era of shrinking bank branches.
Cash recycling has obvious green benefits too, lowering the number of
cash deliveries and thereby reducing carbon footprint.
A remote town or village in Norway could have a recycling ATM, enabling
all local business to deposit their cash, which can then be dispensed to
those in need of cash, Delnevo said.
Taking all these points into account, I would vote for a big future for card-
less ATM transactions, huge increases in ATM biometrics and cash-recy-
cling ATMs, a substantial rise in the number of bitcoin ATMs and, finally,
continued global popularity of cash for payments under $50.
Just around the corner, I believe, is a new golden era for the ATM as a core
payments hub in a reconfigured banking and consumer landscape.

ATM future trends
report offers macro, Vincenzo Fiore
micro market insights CEO, Auriga
Vincenzo Fiore, founder of Auriga and

CEO since 1992, is an energetic leader
Auriga actively sponsors a broad range of market studies. This, our most who is personally involved in all aspects
recent project, in collaboration with ATM Marketplace, offers a number of of the companys growth and continued
interesting insights. success. Under Vincenzos leadership,
Auriga has successfully delivered a
Aimed at both the large and small institutions around the world, the survey
wide range of software and services to
asked participants to rank a variety of investment initiatives in order of ur- hundreds of financial institutions in Italy
gency and importance to their own organization. Survey respondents were and beyond.The companys core values of
given 17 different initiatives to choose from, and the responses were then delivering innovative solutions and lasting
grouped by geographical region and relative score. value are recognized and appreciated within
the omnichannel banking sector.
One of the interesting results of this market study is that four of the top five
investment categories in each region were the same, specifically:
Mobile integration;
Branch transformation;
Security and EMV; and
Cash recycling.
While there are variations in the relative priorities across different regions,
these four drivers truly represent global trends. And, it is highly likely that
these trends will remain the primary forces of change in the ATM market
over the short to medium term.
Equally interesting is the fact that the fifth investment category was unique
within each region:
Migration from magnetic stripe cards within the U.S.
Cost reduction within Europe;
Emergence of IADs in Asia-Pacific; and
Outsourcing of ATM networks in the Middle East.
A number of these investment areas are common to multiple regions, albeit
at a lower priority than those regions top five rankings.

Below the surface of these macro trends lie several intriguing emergent
subtrends that continue to foster significant innovation and change in the
ATM market. One of the most profound areas for change is directly affect-
ing self-service devices themselves.
The global ATM market continues to be dominated by the traditional Big
Three manufacturers. However, a number of new entrants are making sig-
nificant headway, both in terms of competitively priced lower-end devices,
and in the high-end, multifunction machines being deployed in sophisti-
cated bank branches.
The choice of ATM software is also attracting keen interest among high pro-
file customers who have been involved in recent months with the selection
of vendor-independent ATM software solutions.
Many of these changes are the result of relentless cost pressures and a
pressing need for banks to build more profitable customer relationships in
the new digital age. Market consensus currently is focused on the imple-
mentation of customer-centric omnichannel strategies as the best approach
to balancing these complex trade-offs. However, most industry observers
agree that optimal leverage of the potential that lies in omnichannel banking
has yet to be fully realized.
Despite these uncertainties, a few factors are generally accepted as criti-
cal elements for example, the vital role of the bank branch in nurturing
proactive customer relationships and dealing with high-value or complex
banking needs.
Another principle that draws broad agreement is that the increase in branch
automation needs to be complemented by appropriately trained branch staff
who are equipped to assist and advise, as needed. Technically speaking, it
is already possible to automate a very large percentage of branch transac-
tions. However, it is equally clear that customers need, and expect, a sup-
portive human touch as they adapt to the new banking era.
Market lessons-learned to date strongly indicate that mass transaction
automation to reduce costs necessitates that branch staff receive new
training, and access to real-time information that enables them to proac-
tively engage and support their customers. In many cases, it also requires
a change to existing processes in order to streamline and enhance the
customer experience.
Recent reports have highlighted that customers who interact with their bank
through multiple channels are likely to purchase more products and ser-
vices from that institution. This is clearly good news in a world of increasing
competition and declining customer loyalty.

Trends reflect IADs and
FIs need to keep abreast
of market demands Andy Orent
CEO, Nautilus Hyosung
Andrew M. Orent is president and CEO of
Over the last 20 years, the self-service industry has changed dramatically, Nautilus Hyosung America, and has spent
and these changes have heavily affected both the financial and the IAD- more than 30 years selling technology,
ISO segments. software and services to the financial
services industry. Prior to his appointment
More sophisticated consumers are demanding higher levels of service, driv- at Nautilus Hyosung, he was vice president,
ing the need to make new transactions available via multiple channels. At Oracle Banking Platform, and Global
the same time, the ATM owner-operator has a need to improve profitability. Business Team Leader. Before joining Oracle,
he led the global WW Financial Services
Industry team at HP. In the past, he also
Cash continues to be king has held key leadership roles in general
Despite numerous media reports and predictions in recent years that cash management, sales and marketing at NCR.
is on the wane, in fact, the opposite is true. According to the Federal Re-
serve, the volume of U.S. currency in circulation increased by nearly 10 bil-
lion notes between 2007 and 2013. And as consumers become more wary
of data breaches, cash may continue to rise in popularity.
An emerging requirement will be to rationalize the flow of cash between the
retail store and the ATM owner-operator, whether an FI or an IAD. We see
an increasing need to physically maintain cash in-store securely, while al-
lowing the value of cash to be moved across, and between, the retailer and
ATM owner. This will also allow the remote prediction of overall cash and
denomination volumes.
Given that cash is going nowhere anytime soon and that cash handling
is expensive it is imperative in both the IAD-ISO and the FI spaces to
work with a partner who understands both markets and the business of
cash handling. And in fact, the two markets are not as different as you
might think.
More security, innovation, flexibility and responsiveness

IADs and financial institutions are not all that dissimilar. Both are navigating
a world in which transactions are down, and regulatory pressures are

stifling some aspects of the business that once were counted as key
revenue streams.
Customer service, security, innovation, flexibility and agility are paramount
for both FIs and IADs-ISOs. And for both, new revenue streams and trans-
actions and improved efficiency are a must.
By implementing more innovative, feature-rich and secure devices, both
IADs and banks can provide a greater customer service experience that
will unlock new revenue streams and enhance profitability going forward.
Trend-spotting for FIs and independents

As a market leader in the IAD space with a 60 percent share year after
year and also in the emerging FI branch transformation market, Hyosung
is not only aware of these trends, but also is a driving force behind them.
In the retail market, we are dramatically increasing our investment in
technology and software designed to drive additional revenue streams and
lower operating costs for IAD-ISO customers. This could mean anything
from allowing consumers to buy tickets for events or mobile phone minutes
to enabling them to make a charitable donation through an ATM.
We are also paying particular attention to the evolution of new forms of
electronic and wireless payment (i.e., Apple Pay and Google Wallet) and to
the integration of ATMs into these other channels.
Additionally, we are partnering with some of the most sophisticated and
advanced financial institutions around the world to provide best-in-class
branch transformation solutions that move transactions to a lower-cost
channel in order to drive down branch costs.
These projects are designed to migrate basic transactions and cash
handling from human tellers to automated devices, and to increase self-
service capabilities. For example, in many bank branches, tellers still spend
too much time counting cash as opposed to interacting with customers. A
branch transformation project might examine redirecting resources toward
solutions that can automate cash handling, allowing cash to move securely
from where it is physically in the branch to where it needs to be. Investing
in technology solutions that provide enhanced self-service capabilities and
automate manual processes is obviously central to any branch transforma-
tion project.
Financial institutions are finding that branch transformation must be under-
taken in a strategic way, encompassing people, process and technology,
in order to meet the business goals of the institution. Banks know that their

branches still fill a role in new-customer acquisition and cross selling, but
need to be reformatted and reimagined to appeal to the modern customer.
Finally, we at Hyosung are leveraging our advanced cash handling capabili-
ties to help both retail and banking industries manage cash more efficiently
between them. This will bring a new level of security, efficiency and ef-
fectiveness to the management of overall cash flow for medium and large
retailers, giving them a clear competitive advantage.

Taking action
around the branch Brian Bailey
vice president of
marketing and strategy,
of the future NCR Financial Services
Brian Bailey, vice president of marketing

and strategy, is responsible for the growth
The popularity of branch banking is heating up among consumers, and and strategic direction of NCR Financial
this is lighting a fire under the seemingly inextinguishable debate over the Services, the largest division within NCR
branch of the future. Corp. In 20 years with NCR, he has held
management positions in the areas of
When the American Bankers Association released new survey data this
sales, marketing and product management,
summer showing a sizable gain in popularity for branch banking among including assignments in NCRs Asia Pacific
consumers, the digital pundits sharpened their knives and went in for the and European markets. Bailey is a graduate
kill. They attempted to poke holes in the increasing emphasis banks and of the University of Dayton in Dayton, Ohio,
credit unions are placing on branch strategies, and the investments they where he earned a Bachelor of Science
are making in the channel. degree in Marketing and Finance.
The argument, theyll say, is that the branch is the lowest-performing chan-
nel in the banking network, and its misguided to put time, energy, resourc-
es and capital into the branch of the future.
Maybe the issue with banks putting an emphasis on branch of the future
isnt with the branch. Maybe the issue is with waiting for the future.
The need for a right-sized retail network is today. The opportunity for a
right-sized retail network is today.
Banks are moving on from future-branch thinking and instead taking action
around transformation through usability, design, service-first architectures
and frictionless environments. If you look at the spending of financial institu-
tions today, they are speaking with their pocketbooks because their custom-
ers are asking for it.
In the U.K., the Royal Bank of Scotland alone plans to spend more than
1 billion pounds ($1.5 billion) over the next three years to transform its retail
network. The heavy lifting of a right-sized distribution network is more than
just about closing real estate. Its more than just investing in technology. Its
about connecting with people. Its about consumer engagement.
The table stakes of right-sized branches, redeployed tellers and trans-

formed processes can only yield success if banks can reconnect in a mean-
ingful way with consumers at the branch.
The crazy thing is that consumers want to be engaged in a meaningful way.
An Accenture study showed that about two-thirds of consumers still prefer
to speak with a bank representative face-to-face when purchasing a new
product, rather than buying online.
Perhaps this is why the branch of the future discussion has gone on for
so long. For years, weve understood the tenuous dynamic between the
branchs original function as brand ambassador and sales-and-services
center, and the inherent cost associated with the channel. Several years
ago, Tower Group estimated that a new branch must accumulate $40
million in new deposits within its first five years to justify the average $2.7
million cost of building; however, the typical new branch averages just $27
million in deposits in its first five years.
So what is the balance between operational cost and revenue growth? Is it
wise to emphasize a channel being characterized as in decline?
Some things are worth fighting for. Some things intrinsically hold value
and deserve our attention. Some things just need some creative solutions
to improve.
For a bank, sacrificing a physical presence in the community only makes it
easier for digital competitors to steal customers or for nonbanks to lever-
age their retail presence to offer banking services to fill the vacuum created
by branch closures.
The market is becoming crowded with nonbank alternatives, most in the
digital space. Other disruptors such as PayPal have simplified digital pay-
ments, and some would say the need for a bank account is declining. Amid
all this pressure is a clear opportunity for growth.
According to a 2014 Bain report, direct banks enjoy a 70 percent net
promoter score advantage over their traditional rivals; however McKinsey
reported this year that digital enquiry vs. sale conversion is a fraction of
that achieved at the branch 15 percent compared with a whopping 85
percent at the branch.
Ultimately, banking is a service industry. Expertise, service and trust matter.
People play an important role in that. Human engagement and interaction
are essential to providing the full service customers demand.
Over the past several years, assisted service has taken the retail banking
industry by storm, merging technology and people to put a human touch
back into banking. Assisted service allows consumers to receive all the

benefits of self-service convenience and accessibility with the added benefit
of personal staff interaction.
Through assisted service technology, banks can improve their physical
distribution economics through capital-friendly network models, delivering a
complete range of financial services to their customers.
This new model will allow customers flexibility in where they prefer to do their
banking, while radically altering branch cost and revenue models. In the pro-
cess, NCR is working with banks to synchronize their channels, creating an
informed sales platform that makes each customer interaction count.
Through the use of assisted service, Wells Fargo has created a new local-
store approach that the bank anticipates to require 40 to 50 percent of
typical operating costs.
Through the use of assisted service, another NCR customer has seen
annual sales grow 76 percent, along with dramatic improvements in net
promoter scores. By the end of Q2 2014, more than 100 banks and credit
unions were implementing NCR assisted service solutions to help transform
their networks.
NCR also is taking its assisted service solutions which include interactive
services technology to international markets including the Middle East,
Europe and South Asia.
Banks do need to examine their digital and physical service distribution and
align them with market priorities. Their response, though, doesnt need to
be cut, then cut, then cut some more. Technology, along with other com-
ponents, is putting banks on the path to an improved branch environment
and consumer engagement.
For the branch, the future is now.

Bold (and not so bold)
predictions for the
future of retail ATM
Daryl Cornell
CEO, Triton Systems
Daryl Cornell is President and CEO of

Triton Systems. Before joining Triton in
Retail ATM functionality will expand beyond cash dispense
2007, he served as general manager, COO
ATM capabilities such as lottery ticket and gift card purchases, charitable and CFO for a number of private equity
donation, direct currency conversion, mobile phone top-up and digital ad- portfolio companies, and also served in
vertising are all now being offered at some level at retail ATMs. a variety of finance and operational roles
at Ryder System. Daryl holds a Bachelor
Given the growing costs of regulatory compliance and necessary upgrades, of Science degree in mathematics and
it is essential that ISOs grow their business and leverage their ATM footprint computer science from Florida Institute of
beyond the shrinking interchange and surcharge model. These expanded Technology and an MBA in finance from
the University of Florida.
ATM technologies have made strides in recent years and will finally reach
critical mass in the near future.
The costs of operating a retail ATM business will

continue to mount
EMV upgrade expenses are only the tip of the iceberg. Operation Choke
Point has banks dropping retail ISOs like hot potatoes. Banks no longer
want to provide services to ISOs who load their own cash, and rumors
regarding closer scrutiny of merchant cash load are growing.
Add to these headwinds interchange pressures, proposed surcharge caps,
fraud chargebacks and other threatened regulatory interference, and you
will almost certainly see a contraction in the number of ATM ISOs over the
next few years.
Retail ATMs will begin to see significant breaches

The year 2014 was the year of the POS and database breach. It also was
the year when financial institutions began to upgrade their ATMs for EMV
and migrate their fleets to Windows 7.
Predictably, thieves will now migrate from hardened silos to more opportu-
nistic targets. This means that retail ATMs will be hacked with increasing
frequency in 2015 and beyond.

We have already seen these types of attacks outside the U.S., including
not only card skimming operations, but also the use of sophisticated hack-
ing methods that can empty a retail ATM quickly. Hardware and firmware
to thwart these attacks are available, but thus far, few ISOs have decided
to upgrade.
Bitcoin (and the bitcoin ATM) will garner outsized press,

but remain on the fringe
The bottom line is that governments generally perceive bitcoin as a threat
to fiscal sovereignty. Central banks benefit greatly from the ability to create
currency out of thin air. It is doubtful that any country would willingly con-
cede that power to alternative currencies such as bitcoin.
In addition, virtual currencies like bitcoin are tempting targets for hackers.
Look for increasing regulation, taxation and consumer protection legisla-
tion directed at bitcoin.
Cash will remain king

Prognosticators worldwide continue to predict the imminent death of cash.
However, recent surveys have shown that 80 percent of low-value transac-
tions and 50 percent of all transactions are still conducted with cash.
When you hear stories about the explosive growth of mobile payments, re-
member that these transactions are generally at the expense of bankcards
and checks not cash.
Mobile is undoubtedly coming, but the ubiquity, anonymity and overall con-
venience of cash will continue to drive its popularity. Fortunately so, for at
the end of the day, it is the dispensing and recycling of cash that keeps the
ATM ISO business viable.

Connecting with
customers through Alicia Moore
head of Wells Fargo
ATM innovation ATM Banking
Alicia Moore is a senior vice president and

head of Wells Fargo ATM banking. She
At Wells Fargo, we know that, for more than 160 years, our customers have
started her career with Wells Fargo in 1988
chosen to do business with us for one simple reason: We have maintained as a teller, and joined the ATM banking
a commitment to meeting their financial needs. group in 2000. Moore served in various
A big part of that commitment is convenience we have approximately store management roles before taking on
management of centralized communication,
6,200 retail banking stores and more than 12,500 ATMs coast to coast,
process and procedures for stores. She
along with 24/7 access to phone banking and a variety of online and mobile led the business group in designing and
options. Access to banking and other financial services is never far away. launching a new, more efficient teller system
But we believe its what we do with these convenient options that really known as TellerVision and a banker tool
makes a difference to our customers. known as Store Vision Platform.
Our thousands of stores and ATMs wouldnt be nearly as effective in meet-

ing the changing financial needs of our customers if we didnt work so hard
to understand those needs and to show our customers that we under-
stand them.
Of course, one critical way to build lifelong relationships with customers is
through our network of personal bankers who live and work in the commu-
nities we serve. These individuals are passionate about helping our cus-
tomers succeed financially at every stage of life.
We also know that customers interact with us by using a combination of the
various channels we offer. Thats why we are constantly looking for new
ways to connect with our customers in a meaningful way. One way weve
done that is through our network of ATMs.
For decades, Wells Fargo has been working to drive ATM innovation in
ways that make it easier for our customers to conduct transactions and go
about their busy lives. Some of those innovations have been driven by a
desire to meet the diverse needs of our customers. For example, all of our
ATM locations feature ATMs with voice instructions for the visually impaired,
and on-screen instructions are available in eight languages: English, Span-
ish, Chinese, Vietnamese, Korean, Hmong, Russian and French.

Other innovations have been motivated by our commitment to environmen-
tal stewardship. For example, we were the first bank to offer ATM receipts
via email and text, and since 2011, our entire ATM network has been enve-
lope-free, which not only saves customers time, but also saves thousands
of trees each year.
Weve also created a number of features that aim to delight our customers
by showing them that we know them. In order to help our customers man-
age their money, we designed a new feature, Cash Tracker, which automat-
ically displays the total amount of cash theyve withdrawn from Wells Fargo
ATMs in the current calendar month.
In recent years, weve also launched projects that allow us to wish our ATM
customers a happy birthday or a happy anniversary of the opening of their
account. And, this past year, we began to allow customers to send a person-
alized birthday greeting to a joint accountholder through our ATM network.
In addition to connecting with customers on a personal level, were always
looking for ways to remind them that were truly invested in their communi-
ties. Each year, we honor educators across the country by congratulating
the teachers of the year in a number of states on our ATM screens. We also
frequently display localized ads celebrating achievement in the world of
sports, including one this fall congratulating San Franciscos baseball fans
on their 2014 championship.
All of these initiatives have generated wonderful feedback through our
bankers and social media channels, and have been a great way to show
our customers that we know them and their communities.
A network of convenient banking options is critical to the success of a com-
pany like Wells Fargo, but that network is most effective when its used in
a way that provides a complete customer experience. By focusing on ATM
innovations that allow us to show our customers that we really know them,
Wells Fargo is doing more to help those customers succeed financially.

ATM trends
in mature and Leland Englebardt
group head of network
emerging markets solutions, MasterCard
Leland Englebardt is group head of network

solutions at MasterCard. In this role, he
The global ATM channel is increasingly divided into two quite different envi-
leads the team responsible for business
ronments. In mature markets, the growth of electronic payments is forcing management of MasterCards global switching
ATM operators to rethink traditional business models. In emerging markets, platforms for credit, debit and prepaid
the rapid growth of banked consumers and relatively high levels of cash products. The MasterCard Network switches
use are driving ATM demand to new heights, but this growth may be short- more than 34 billion transactions per year
lived. Both environments demand and will reward innovation, scale and a in 150 currencies, initiated with MasterCard,
Maestro and Cirrus-branded cards in 210
long-term strategic view.
countries and territories worldwide.
The principal challenge is that from a consumer perspective, ATMs are a
commodity. All ATMs provide the same core service (cash disbursement
and balance enquiry) and deliver the same product (currency). Global and
national networks generally ensure that all ATMs can fulfill a consumers
cash needs.
Outside the markets where off-us ATMs are permitted to surcharge con-
sumers, which drives people back to ATMs operated by their own bank, a
typical consumer simply uses whatever ATM is most convenient. From a
business perspective, this means ATM operators must either differentiate or
accept marginal and shrinking returns neither of which is easy.
In mature markets, where the need for cash (though not necessarily the
preference for cash) is steadily diminishing, bank ATM operators are ag-
gressively leveraging technology and using ATMs to grow their perceptual
scale. Some banks promote their ATM footprint as a competitive advantage.
This trend is a boon to nonbank ATM operators with the scale to support
bank branded off-premises ATMs throughout a market.
Also, through innovations like live video and scanned deposits, bank brand-
ed ATMs are performing more and more functions traditionally performed by
human tellers, helping to drive efficiency gains for banks. Forward-thinking
banks are rapidly modernizing the design and user interface of their ATMs
to meet consumer expectations that have been elevated by personalized,
multifunction devices such as smart phones.

The increasing sophistication and differentiation of branded ATMs will put
heavy pressure on independent white label ATMs. These ATMs will see
continued and accelerated reduction in volume per terminal unless they
develop a differentiated value proposition. This new value will likely come
not from cash disbursements, but from creative development of the ATMs
relationship with its merchant host. Independent ATM operators that lever-
age a deep knowledge of their merchant partners business drivers can
propel gains for both parties and are more likely to defend their franchise.
In emerging markets, ATM deployment and volume is growing rapidly. In
some markets, ATM use has benefitted from long-term government efforts
to increase the banked population and to convert benefit delivery from
vouchers to electronic payments. Growing demand has in some cases
driven linkage of domestic ATM networks to provide ubiquitous cash access
for an increasingly affluent and mobile population.
Emerging markets also have challenges. E-commerce and other forms
of retail electronic payments are becoming more accessible and growing
rapidly, beginning to displace cash. This trend will accelerate. Adoption of
smart phones and availability of noncash electronic payment applications
are proliferating.
As major markets adopt EMV chip and other effective security tools, inter-
national criminals are beginning to target less fraud-proof ATMs in emerging
markets. In some markets, ATM deployment and use is still limited by mar-
ginal infrastructure, lack of physical security or political/economic instability.
ATMs will continue to be a major feature of the consumer payments land-
scape for years to come. The longer-term future of ATMs outside of bank
branches can only be ensured by relentless innovation of the ATMs functions
and of its business model. ATM operators must look beyond traditional vend-
ing functions and integrate the ATM with retail as an engine of commerce.

ABOUT THE SPONSORS
Auriga, with offices in Italy, London and Paris, is one ATMmarketplace.com, owned and operated by Lou-
of the leading European suppliers of software and isville, Kentucky-based Networld Media Group, is the
solutions for omnichannel banking. It provides financial worlds largest online provider of information about and
institutions with products, services and consultancy for the ATM industry. The content, which is updated
for managing self-service, Internet, mobile and branch every business day and read by business and industry
banking. Auriga has a proven ability to help banks professionals throughout the world, is free.
improve their efficiency and competiveness. For more
information, visit http://www.aurigaspa.com/eng/

Auriga Atm Futuretrends 2015 Final

Загружено:

Сведения о документе

Авторское право

Доступные форматы

Поделиться этим документом

Поделиться или встроить документ

Параметры публикации

Этот документ был вам полезен?

Это неприемлемый материал?

Авторское право:

Доступные форматы

Auriga Atm Futuretrends 2015 Final

Загружено:

Авторское право:

Доступные форматы

ATM Future Trends

Page 45 Mobile technology: Page 72 About the sponsors

Page 48 The ticking time bomb: Interest rate rises

Page 55 The future of ATM technology Alan Fryrear, chairman

Page 60 Trends reflect IADs and FIs need to keep

2015 NETWORLD MEDIA GROUP 2

In some cases, we found consumer sentiment in both markets to be

How important is it to you to have access to a fee-free ATM?

2015 NETWORLD MEDIA GROUP 3

Is it more important to you to have an ATM nearby, or a branch nearby?

US consumers Indian consumers

Neither, I do my Neither, I do my banking

We also found that the expectations and objectives of consumers and

2015 NETWORLD MEDIA GROUP 4

Bill payment at the ATM 61%

To understand the importance of this in todays market, simply consider

This self-service model has been propelled by the development of ad-

2015 NETWORLD MEDIA GROUP 5

This has been underscored by an increase in ATM cashing-out or jackpot-

In another computer exploit, cybercriminals stole masses of prepaid card

By 2012, the notion of prestaging a cash withdrawal through a banking app

2015 NETWORLD MEDIA GROUP 6

At that time, we had no bitcoin ATMs, no foreign remittances via virtual

2015 NETWORLD MEDIA GROUP 7

1. What is your age? 2. Where are you?

3. What is your gender? 4. What is your annual household income?

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 8

Cash withdrawals in multiple denominations (not just $20 bills) 64%

Real-time transactions 30% 46% 45% 32% 23%

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 9

Personal preference setup 19% 22% 17% 32% 23% 25%

Cardless cash withdrawal using mobile app 13% 24%

Personal preference setup 21% 22%

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 10

Less About the same More I never carry cash

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 11

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 12

29% 29% Ill start thinking about it very seriously

15% Ill still use cards; my bank covers any fraud,

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 13

Very important 35% 37% 37% 36% 47% 13%

Somewhat important 11% 10% 10% 10% 13% 25%

Not that important 1% 3% 1% 1% 0% 13%

I dont care 5% 3% 2% 0% 2% 13%

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 14

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 15

Im aware of the possibility, but not that concerned

Whats a skimming device?

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 16

Sort of important; I dont mind going a little out of my way

Doesnt matter; I never use the ATM anyhow

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 17

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 18

It will make them

I dont know what that is 24% 11% 13% 14% 22%

I dont know what that is 19% 17% 12% 7% 17% 31%

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 19

Neither, I do my 2% Neither, I do my banking

U.S. CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 20

1. What is your age? 2. Where are you?

3. What is your gender? 4. What is your annual household income?

Less than 15,000 INR

INDIA CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 21

INDIA CONSUMER SURVEY RESULTS ATM FUTURE TRENDS 2015 22