During the webinar, Kirill Ovsiannikov, Deputy CEO for Strategic Directions at BS/2, will talk about modern tools for monitoring the amount of cash in ATMs and planning cash flows in the banking infrastructure, which help to reduce the costs of ensuring the continuous operation of automated customer service points, in particular, the costs of raising cash and cash collection of the self-service devices.
Besides, TBC Bank (Georgia) representative Ketevan Kebuladze, who supervises Cash Management.iQ product development within the bank’s infrastructure, will join the webinar as a speaker. Ms. Kebuladze will speak about the prerequisites for implementing this solution, as well as about the tasks that the bank managed to solve in terms of ensuring the cash availability at customer service points.
On the eve of the event, we asked Kirill Ovsiannikov to tell us what caused the choice of the webinar topic.
— Today, many banks are closing their branches and moving towards the development of automated service points to optimize the costs associated with customer service. What are the challenges facing a bank that relies on the development of its self-service channel?
In the context of the automated service points network development, a bank faces two global strategic goals. The first one is the devices’ functionality development, which would make it possible to provide as many services as possible from the portfolio of a financial organization through ATMs. The second one is increasing operational efficiency, which is optimizing the costs of owning the infrastructure and reducing the necessary costs for it due to more competent device management. This can include the costs of maintaining devices, cash collection costs, the cost of processing transactions, the cost of raising cash, etc.
— What costs can the terminal network owner reduce and how?
Usually, to reduce the operating costs associated with the automated service points, banks resort to outsourcing services for non-core activities: maintenance of ATMs, cash collection, and even outsourcing of processing.
Raising cash for a fleet of self-service devices is one of the most costly items in the operational efficiency of ATMs. In the Caucasus region, where we work, the refinancing rate is quite high, at least 3-4%, in some countries it is even higher. For example, the refinancing rate in Georgia today is 10%, while in Azerbaijan it is kept at 6.5%. Thus, banks’ expenses only for raising cash are quite high. If you add to these the costs of insuring cash and its handling and delivery costs, the figure is even higher. The more cash a bank needs for ATMs, that is, the more cash is in circulation, the higher the costs of a financial institution for maintaining the terminal network. Thanks to modern tools for monitoring and planning cash flows, owners of terminal networks can, without affecting the operation of the entire infrastructure, reduce the amount of cash required for ATMs. And this, in turn, can also significantly reduce the cost of raising and processing it.
Another cost item that can be reduced through the use of specialized solutions is the number of cash collections. Optimal cash planning for ATMs can significantly reduce the number of required CIT-service visits while providing automated service points with sufficient cash required for their continuous operation.
— Can you give real numbers?
We have implemented a number of projects to optimize the processes of cash circulation in the countries of the Caucasus region. The main challenge banks wanted to address was to reduce the end-of-day ATM unused cash balances, as this is the largest fraction of the total cost of ownership of a self-service device in terms of operating costs. Thanks to the use of our solution, banks were able to reduce their expenses for raising cash by an average of 15-20%, and in some cases even more. In those financial institutions where the system for providing ATMs with cash was not automated and most of the work and settlements were carried out manually, we managed to achieve a decrease in balances by more than 30%.
The webinar will start at 10 am (GMT +3, Vilnius, Lithuania). Pre-registration is required to participate in the event. You can do this by following the link.
BS/2 is known as a developer and supplier of banking and retail solutions in 80 countries around the world. The company also provides system integration and outsourcing services, has an extensive network of service centers for servicing ATMs and other terminal devices in 8 countries, and regularly conducts training seminars for industry professionals. One of BS/2’s solutions is the Cash Management.iQ software platform, designed to automate and optimize the processes of cash circulation within the banking infrastructure. It provides modern tools for monitoring and planning cash flows, allowing financial institutions from around the world to significantly reduce the total cost of the terminal network ownership.
