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Mark Aldred, Banking Specialist at Auriga


Banks continue to face strict competiton from both traditional and new entrant banks. In addition to this, Covid-19 has caused a change in consumer bahaviour that has accelerated digital transformation based on the customers’ apparent appetite for smart and digital-first services. A recent survey by Mastercard unsurprisingly found that 22% of respondents have stopped using cash entirely, with cash usage receding amid the pandemic.

Although consumers are becoming more and more familiar with digital payments, the desire for cash has not diminished significantly. After an initial decrease of cash usage in the pandemic, we see worldwide that the trend is reversing and that the amount of cash being circulated through the ATM is now going up in aggregate. Additionally, research from RBR’s Global ATM Market and Forecasts research revealed that the compound aunnual growth rate (CAGR) of worldwide cash withdrawals will increase by 2.1% between 2019 – 2025.

Despite this, banks continue to close down ATMs. While ATMs are facing increased regulatory and operation costs, as well as increased risks from fraud and cyberattacks, this simplistic approach should be called into question, as this may involve leaving some people and communities behind. In the UK, Community Access to Cash pilot schemes have been developed in order to provide cash to underbanked communities, boost local economies, and put payment choice back into local hands.

As a result, financial organisations in the next few years must action policies that enhance ATM security, reduce the total cost of ownership, and improve, modernise, and personalise the customer experience.

FIs must ensure their operating strategies prioritize efficient, nimble, highly scalable and continuously available service channels, both physical and digital. Where this is not the case, it will leave consumers feeling excluded from banking services, which will ultimately reduce the quality of service customers receive.


Mark Aldred

What ATMs can do for banking customers

Contrary to popular belief, ATMs are so much more than just cash-and-dash machines. As long as consumers need cash, however, ATMs remain the most convenient tool for them to access it and for FIs to make it available. Therefore, self-service will continue to play a major role in the customer journey and a fundamental part in consumers’ brand perception.

With the correct technology, self service devices can offer basic banking and community services, such as managing your account, bill payments and loan applications. However, in order to make this a reality for communities, the right software and infrastructure is needed, especially since the customers’ needs and demands already exist.

In the context of branch transformation, multifunctional ATMs are already seen as part of many branch transformation initiatives and can also be an excellent complement or alternative to face-to-face interactions in a branch, as they can offer an extensive number of features and capabilities, 24 hours per day. We predict that they are sure to gain ground in a post-pandemic, interaction-averse landscape.

In addition to this, assisted self-service terminals (ASSTs) have also proven a sound  investment in a number of markets. According to a study from RBR, 340,000 assisted self-service terminals have been deployed worldwide. They allow customers to perform an even wider range of transactions with the assistance of bank employees. The reduced workload on branch staff will allow them to focus on other advisory duties. Because ASSTs encourage greater use of self-service terminals, many banks see them as the ideal bridge between physical and digital channels. They also preserve the human element in banking, which continues to be valued for certain transactions.

It is vital to enable access to cash for all communities, from inner cities, to the most rural areas. Not only do communities need access to cash, but they also need access to an array of banking services that support their local economies. There has been a demand from some areas of the financial industry to implement advances in self-service banking technology in all communities. This can include giving a community a bank branch or reforming a bank branch in a community so that it serves as a focal point for financial and other services. In addition to this, by customising modern ATMs so that they can provide additional services, it can allow cash access to be subsidised through generating extra revenues. These additional services can range from paying a bill, to doing a live call with a financial product specialist.

The pandemic has accelerated digital transformation plans for organisations across all industries, and has led to increased interest in cardless cash withdrawals. A report from RBR found that the number of ATMs offering this solution is increasing as deployers from different markets continue to utilise contactless technologies and implement new alternatives.


How banks can better manage their ATMs

Banks are constantly searching to review the way they are managing their ATMs, from decreasing the ATM management cost, to the costs of cash handling. These efforts are all aimed at reducing the total cost of ownership for ATMs. Banks are now considering pooling and collaborating with each other in order to further reduce the cost of ownership. The benefits of this can include an increased network and more opportunities to commercialise the offering with the increased services provided through ATMs.

Some banks are launching joint ATMs, whereby they share their ATMs with other banks. For example, the Geldmaat initiative is a cooperation between three major banks in the Netherlands. This initiative guarantees the availability and accessibility of cash for the banking customers of all three banks. Some banks are also externalising the complete management of their ATM channel, with BPCE in France serving as an example. Even after the current pandemic, we should expect to see the financial services industry continue to innovate in this area and develop new forms of ATM architecture. And if this is possible, why shouldn’t the concept be extended to branches. In this and other respects it’s only the beginning.


Next-Gen ATM Acquiring

In IT terms, banks should look to adopt a channel integration model that allows both the connection and the isolation of the external channel independent entities (e.g. Transactional Switch, Core Banking, and Services), to make them completely independent and seamlessly usable across all channels. The benefits from this model include a much simpler, cost effective, standardised and generally accepted interface (usually based on ISO-8583, ISO-20022 or Web Services) that focuses on the business services, forgetting all the complexity linked to ATM management, and more broadly to the self-service branch automation.

Further operational advantages include a modular approach and accelerated time to market by having a single point of control of the branch automation channel without the need to define, agree, coordinate, and implement across different products.

This capability finally allows users to extend automation to cover all the functionalities currently managed within the branch. This allows banks to deploy new lean branch concepts that automate the transactional banking services, with 24/7 availability, leveraging video banking technology, and focusing branch personnel on consulting and sales activities.

Customers still require access to cash and will need (and are entitled to) convenient access to the money they hold in their accounts. Having ATM software that enables seamless alignment with current and future needs is going to be key for the future. Customers demand consistency between mobile and physical channels – ATMs that meet those needs will lead to greater usage and could even reduce the cost per transaction of maintaining an self service channel.



How banks can help customers during the cost of living crisis



 Lavanya Kaul Head of BFSI, UK & Ireland, LTI Mindtree


Surging energy and food prices are significantly driving up household expenditure, which means living standards in the UK will fall to 2.2% this year, according to the Office for Budget Responsibility. This is the biggest drop in any single financial year since the records began in 1956-57.

It’s a tough situation for many consumers who are still struggling with financial hardship following redundancies and pay freezes from the pandemic. According to TSB’s Money Confidence Barometer, 82% of people have experienced an increase in the day-to-day cost of living. This resulted in almost a quarter of them using their savings, while one in five changed their usual spending habits and behaviours.

As the financial situation worsens, consumers are increasingly relying on their banks for help and support. But, while banks can’t control inflation, energy or food prices, they can play a more supportive role by adapting their services to offer stronger customer service, better tools for financial management and be more flexible with loan repayments.


Strengthen customer service with intuitive AI solutions

Since the pandemic, consumers have changed the way they bank, using more mobile apps for primary banking rather than going into physical branches. This provided an opportunity for banks to accelerate their investment in digital services including automation and offer customers more support during the cost of living crisis.

Lavanya Kaul

Effective tools include AI-powered chatbots which respond intelligently to customer enquiries to quickly help troubleshoot problems and provide useful advice. But to be successful, you need to ensure you strike the right balance between an efficient and convenient process and creating a personalised experience. Customers need to feel like you understand and care about their problems and are here to help, rather than just fobbing them off with a monosyllabic bot. To avoid this, banks need to embrace intuitive AI solutions to ensure that empathy comes across in all automated interactions with customers. While doing that, messaging is key. In times of stress, we don’t function as well and financial struggles are a huge stressor. The clearer the message and the simpler the instructions, the better.

Financial education, when combined with technology solutions such as open banking, can offer more long-term solutions for people to navigate their finances. This can help put more information into the hands of the consumer to help them grasp their financial situation better. Some banks have cracked this with innovative solutions like HSBC’s Financial fitness score tool that can analyse your money habits and signpost you towards ways to improve your financial health. This may include joining one of the financial education webinars run by the bank or having a ‘financial health check’ with a member of staff.


Launch money management features & apps

Introducing money management features and apps to increase the visibility of a customer’s financial situation, empowers them with the information they need to make smarter choices.

TSB offers Spend & Save and Spend & Save Plus current accounts which include a savings pot that enables customers to put extra money aside when they can and an auto-balancer feature that automatically transfers money from the savings pot into their current account if their balance falls below a certain level. This allows them to start building up savings and protects them from unnecessary overdraft charges.

Personal financial management (PFM) apps also help customers get a better understanding of their finances. These connect with a customer’s bank account and enable them to keep a close eye on their spending habits and track upcoming bill payments. An example is Prism, a PFM app which allows customers to manage bill payments by sending them reminders about due dates. It also provides a summary of their income, account balance and monthly expenses at a glance, therefore consolidating all their financial information in one place and saving time on bill payments.

Lloyd’s Banking Group and HSBC launched a subscription management tool for all customers on mobile, allowing them to see and cancel recurring card payments for things like TV subscription services. HSBC says that during the first quarter of the year, it led to customers dumping around 200,000 subscriptions.


Introduce payment holidays

While improved customer service and financial management tools are important support tactics, they might not be enough for more vulnerable customers. For example, those who are about to default on mortgage payments or loans due to redundancy or periods of ill health need banks to do more, like offering payment holidays. Banks relaxed the rules for payment holidays during the pandemic, so they should consider doing it again to help more vulnerable customers through the crisis. Customers need to understand that they are not alone when experiencing financial difficulties and that help is available


Ride out the crisis together

As inflation reaches a 30-year high, customers are now more reliant than ever on banks for guidance and support. But to provide the right level of service, they need to move away from their traditional ways and behave more like technology companies by embracing automated solutions to create the right products and services for customers. Then layer on top of that the need for more personalised and empathetic customer interactions, as well as consider additional support for more vulnerable customers.

While we don’t know how long the cost of living crisis will last, what we do know is that the pressure on household finances is likely to get worse before it gets better. Therefore, banks need to step up, be the supportive partner and do whatever they can to help customers. After all, the only way we can ride out the crisis is by supporting each other and working together.


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Coreless Banking: How banks can thrive in 2023




Hans Tesselaar, Executive Director of BIAN


In recent years, banks have faced immense disruption and struggled to transform with technology. In fact, our research with IBM found that 88% of banking executives are troubled by their bank’s commitments to multi-year projects, interoperability across technology environments and theft of sensitive data. A lack of industry standards is also causing significant problems and hindering the organisation’s ability to bring new services, at the desired speed, to market.

While banks have made significant advancements in recent years, in order to truly embrace digital transformation throughout the industry,and meet the needs of today’s digital first-customer, banks must focus on adopting a coreless banking model.

In 2023, coreless banking approach will enable the delivery of banking services that aren’t longer dependent on legacy systems, and will support the digital-first customer, bringing real transformation to the industry.

Hans Tesselaar

Putting the Customer First

Without the comprehensive digital infrastructure necessary for today’s environment, financial services organisations are unable to bring services to market as quickly and efficiently as they would like – and need. The extensive use of legacy technology within banks meant that the speed at which these established institutions could bring new services to life was often too slow and outdated. This challenge is also complicated by a lack of industry standards, meaning banks continue to be restricted by having to choose partners based on their language and the way they would work alongside their existing ecosystem. This is instead of their functionality and the way they’re able to transform the bank.

To move forward into the ‘digital era’ and continue on the path to true digitisation, banks need to overcome these obstacles surrounding interoperability. Additionally, with today’s digital-first customer in mind, financial institutions need to take advantage of faster and more cost-effective development of services. Failing to provide these services may force customers to take their business elsewhere. One thing is certain, consumers will continue to prioritise organisations that can offer services aligned to both their lifestyle and needs.

Coreless Banking 

The concept of a ‘Coreless Banking’ platform is one that supports banks in modernising the core banking infrastructure.

This empowers banks to select the software vendors needed to obtain the best-of-breed for each application area without worrying about interoperability and being constrained to those service providers that operate within their language. By translating each proprietary message into one standard message model, communication between financial services is, therefore, significantly enhanced, ensuring that each solution can seamlessly connect and exchange data.

With the capacity to be reused and utilised from day one, and the ability to be used by other institutions, Coreless Banking provides these endless opportunities for financial services industries to connect, collaborate and upgrade.

Banking in 2023 and Beyond

Throughout 2023, banks must prioritise their digital transformation journey and adopt a Coreless Banking model. This approach will empower technology leaders to tackle problems head-on knowing they aren’t tied down by the usual restraints caused by outdated legacy systems.

After the last few years, it is impossible to predict what is around the corner, but banks will rest easier knowing their architecture can modernise and change as needed with a Coreless Banking model.

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