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Use of ATMs
Cash Withdrawal and Balance Enquiry
In spite of a number of innovative services being made
available at many ATMs, cash withdrawal stills remains the most accessed
service at ATMs. However, the migration of routine bank transactions like
cash withdrawals and balance enquiries from teller counters to ATMs
significantly raises the potential for savings in employee costs and greater
employee focus on value-added revenue-enhancing activities such as selling
other financial products and advisory services to customers.
Cash /Cheque Deposit
Again, due to the strong cash culture in India, cash
deposits are most likely higher than in other markets, especially cash
deposits made by commercial customers such as retail shopkeepers and those
whose work involves substantial travelling. A high cash withdrawal rate
results in higher ATM servicing costs due to frequent cash replenishment
requirements. Recent developments in ATM technology have made it possible to
recycle cash in ATMs. Currency notes received as cash deposits are counted;
soiled notes separated and deposited cash dispensed to fulfil withdrawal
transactions. However, regulatory concerns relating to identification of
counterfeit notes and its depositors need to be addressed first.
ATM with Cheque deposit facility is not picking up in India, like other
countries. One of the reasons is the delay in collection of the cheque
deposited in ATMs. Cheque deposited in ATMs is to be collected and deposited
in the designated branch for collection. Another reason is the introduction
of cheque deposit Kiosks by various Banks especially Private sector ones.
These are kept at each some important locations/branches where customers can
deposit there cheques which are collected at intervals which may be
difficult in ATMs.
Bill Payments
Most utilities have inadequate infrastructure for
receiving bill payments resulting in long queues at collection centres.
Hence, bill payment at ATMs has achieved noticeable acceptance by bank
customers. Most banks provide this service through bi-lateral arrangements
with bill-payment service providers. ATM users register their water,
electricity and telephone utility accounts with banks, check their dues at
ATMs, approve bill payments that are debited to their bank accounts and
receive printed receipts for the transactions. This service has the effect
of improving customer satisfaction for both the bank as well as the
bill-payment service providers. Some Banks’ ATMs even accept charitable
contributions to Temples.
Sale of Paper Based Products
ATMs are ideally suited to sell paper-based products and
services such as tickets, wireless phone recharge cards, financial products,
etc. The screen interface allows browsing and customization, access to bank
accounts facilitate payments and printing capabilities produce the actual
product/service.
A number of banks including ICICI Bank, SBI and PNB have ATMs at Mumbai’s
local railway stations to dispense season tickets to commuters. Own-bank
customers pay no extra charge while other bank customers pay a fee of Rs. 50
for this extremely useful service of anytime ticket purchase. Railway season
tickets represent a high-volume mass-appeal product. As technical standards
get established and product/service sellers become aware of the ATM sales
channel, niche-appeal high-margin products like entertainment tickets will
join the fray.
Kiosks
Information Kiosks has been introduced by many Banks and
also by PSUs like Railways, Tourist centres etc. While the revenue-producing
capacity of non-emergency type of information at ATMs as a stand-alone
product is doubtful, many customers may be willing to pay a nominal fee for
information having “impulsive” demand such as cricket scores while they wait
for their transactions to be processed. To be sure, providing information,
whether priced or free, will appeal to some customers and increase customer
satisfaction.
Union Bank has used technology to establish Village Knowledge Centres
(VKCs), which have proved to be a success in the 198 centres, where they
have been set up. VKCs empower the local rural population by giving them
information on various vital inputs such as weather, fertilizers, prices of
crops, etc. The bank is also operating financial education centres offering
counselling at 51 of these VKCs.
Third Party Advertising
In India, ATM advertising for third-party products is
currently not allowed by Regulatory authorities. However, the wait time at
ATMs can be effectively used by banks to promote their own brands, product
and services. Furthermore, banks can tailor advertising messages based on
customer information easily available in their accounting and CRM databases.
Customer wait-time at ATMs while transactions get processed, typically
between 10 to 25 seconds, has been profitably used by many banks for their
own advertising.
Money Transfers
Indians, who have migrated abroad or to cities,
regularly use money orders and wire transfers to send money to their
families back home. ATM growth, especially in rural India, will capture
substantial business from the expensive wire transfer agents’ network and
the customer-service lacking postal network. In line with international
trends, ATMs can be made capable to dispense printed money orders or
initiate wire transfers against a charge on customers’ bank accounts. After
addressing regulatory hurdles, these services can even be made available to
non-account holders through cash payments using the currency acceptors built
into ATMs. ATMs can also facilitate the encashment of wire transfer amounts
by allowing even non-account holders to withdraw cash based on PINs or
previously mailed special-purpose ATM cards.
Recharge Mobiles via ATMs
ATMs are also used to recharge mobile phones. Initiated
in 2004 by ICICI Bank, now most ATM/Debit Cardholders are able to recharge
their pre-paid subscriptions of most mobile service providers from anywhere
in the country using their bank‘s ATMs or by sending a SMS.
The amount for recharging the mobile phone would be debited from the
subscriber‘s Bank account and the subscription would be directly recharged
accordingly. The mobile top-up facility provides convenience on ATMs and
through mobile phones using SMS.
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