Five things we learned from four different ATM industry events

It’s no surprise that ATM deployers focus on reducing costs. Tactically, this involves using cassette utilization analysis to cut cash-in-transit expenses and installing cash recycling ATMs to minimize replenishment costs. Out of the 3 million ATMs worldwide, Diebold and NCR hold two-thirds of the global market share. One-third of these ATMs are equipped for recycling, showcasing the sector’s progress in boosting efficiency.

ATMs are essential in branch consolidation strategies worldwide, as many banks shift transactions from tellers to multifunctional ATMs to cut costs. Smaller banks and credit unions are particularly excited about interactive teller machines (ITM). One teller can manage up to six ITMs, highlighting their potential to speed up branch consolidation.

NFC authentication, popular in retail, is becoming essential for ATM operators. However, methods like QR codes and one-time passwords are less common in Europe, the U.S., and the U.K. compared to emerging markets.

The sector is adapting to advanced security protocols with the TR31 (X9.143) mandate in effect and TR34 (X9.139) soon to follow. Financial institutions are upgrading to TLS 1.2 due to increased man-in-the-middle attacks. Vendors are also preparing for AES and Windows 11 compatibility, driven by bank requests rather than PCI mandates.

Despite annual cash withdrawals declining from $4.8 billion in 2019 to $3.875 billion in the U.S. in 2023, the approximately 400,000 ATMs operated by banks and independent ATM deployers (IAD) remain a vital feature of cost reduction strategies for financial institutions. Comparing reported transaction costs shows why – teller services cost $8 per interaction versus $0.60 for ATM transactions, and under $0.20 for mobile or online transactions.

Non-withdrawal transactions, such as bill payments and deposits, have surged at Diebold Intersect and NCR Partner Summit, offsetting the decline in cash withdrawals. Balance inquiries make up 15% of ATM interactions, showing that many consumers still use ATMs to manage their finances. The average cash withdrawal per visit has risen by 26%—from $181 in 2019 to $228 in 2023—increasing the total annual cash withdrawal value from $950 billion to $996 billion.² This increase is attributed to inflation and fewer, larger withdrawals per transaction. Credit unions and small financial institutions struggle with profitability, especially in rural areas. To address this, they are deploying ITMs. NCR reported an 18% year-on-year growth of ITMs in the U.S. from 2019 to 2023, increasing from 11,800 to 23,000.³ However, these terminals can be challenging for older customers. Larger banks, in contrast, are upgrading and relocating ATMs, analyzing terminal usage for cash recycling, and supporting contactless transactions.

With a 40% drop in the U.K.⁴, ATM pooling initiatives like Belgium’s Batopin, the Netherlands’ Geldmaat, and the U.K.’s post office partnership aim to boost efficiency. Multivendor software supports ATM pooling by allowing a common application for participant banks with various compatible hardware. Pre-integrated software can cut costs further by offering features like cash forecasting, device security, and monitoring. Additionally, pooled ATMs can generate revenue through targeted marketing and dynamic currency conversion.

ACI Worldwide continues to support financial institutions and IADs in navigating the challenges and opportunities in the ATM industry, with its suite of terminal driving and switching products: BASE24, BASE24-eps, and Postilion REALTIME. ACI Worldwide is helping ATM deployers modernize and reduce costs through a clear strategy that includes enabling cost-saving functionalities like cash recycling, enhancing contactless capabilities across all device handlers to meet growing consumer demand, and supporting security and compliance with TR31 and TR34 standards in all device handlers. Future updates—including AES, Windows 11, and TLS 1.3 support—will further solidify ATM networks’ adaptability in a shifting financial landscape.

Three ways to stay updated on industry trends and news:
See us at ATMIA booth #523, February 5-7, 2025, in Orlando.
Visit ACI’s ATM solution webpage.
Request a consultation with one of our digital payment experts.