At Diebold’s International Management Seminar in Amsterdam in mid-October, its 30th such event but the first one as Diebold Nixdorf since the Wincor merger, particular attention was paid to ‘connected commerce’.
However, ATMs may not be part of this connection – at least in-branch,
Philippine Risch, director of ING’s branches and cash in the Netherlands, believed ING’s purpose was to help its customers stay ahead by being “a tech company with a banking licence”.
Is there a need for branches in an increasingly digital world?
Risch argued strongly in the affirmative.
She said: “The ultimate experience is digital mixed with human experience.”
However, she highlighted that the branch would only be useful if it was there to satisfy a customer’s needs. Even if a branch is not needed, customers can feel relieved to see one.
Additional services that a branch can provide are human help and guidance.
Risch added: “Sometimes people just even want to vent frustration at their bank and appreciate general attention. The human contact makes the difference in a customer relationship. The human touch adds to the heart and the emotion of the digital relationship.”
ING’s branches will now focus on being advice branches or experience branches.
One thing that may not have a future in ING’s branch is ATMs. Risch would not elaborate, but said cash will retain in a large role in Dutch society, but will not play a huge part in branches.
Therefore, ATMs would eventually be removed.
Christian Weisser, senior vice president and managing director Europe, Middle East and Africa at Diebold Nixdorf, said: “We see four global forces in our space: automation, digitalisation, individualisation, and a strong trend to consumer everything as a service. Cash as a service, ATMs as a service, everything is a service. These forces drive retail and banking.”
Weisser described the future as not necessarily a ‘cashless’ society, but definitely a ‘cash-lite’ one.
With PSD2’s imminent arrival, the four “global forces” combine and the financial sector needs to embrace this.
He added: “Connected commerce means providing an app that isn’t only financial advice, but also provides tips for lifestyle.
“By 2018, a billion accounts’ information will be available. So why not be the first to aggregate all this information into your app?”
Death of cash, no future for ATMs or cards-the daily pitch
Rarely does a day go by without some call or email from a breathless PR telling the writer about the imminent death of cash.
Or a discussion with a banker arguing that consumers ‘no longer want to use cash’.
Often of course they have a strong vested interest, such as a banker from one of the new start-ups that will not be rolling out its own network of ATMs.
The one consistent feature is their determination to ignore a few facts that they dislike as they do not fit their own agenda.
Such as the total value of notes in circulation in the UK increasing by 10% last year to exceed £70bn for the first time.
Or the total aggregate value of ATM withdrawals in the UK stubbornly remaining constant in recent years at around £190bn each year.
Sadly UK banks missed a trick to boost ATM functionality by not adapting ATMs to offer the range of services readily found in Europe.
The UK has a dismal record compared with the continent in terms of ‘recycle ATMs.
It is a safe forecast to say that UK ATM numbers, currently standing at all time high of about 70,000, have peaked.
As in the Netherlands, we can expect to see fewer ATMs in the UK within the diminishing numbers of branches.
But if Payments UK is to be believed, and I have no reason to doubt its forecast, cash will still account for about a fifth of all payments in 10 years time.
Unless of course the new digital entrants to the market trying to win market share from the incumbent banks succeed in denying consumers the choice of how they wish to pay; that would be somewhat ironic as public policy in the UK is to encourage the new players, to widen consumer choice.