BANKEN
July 17, 2019 | DIEBOLD NIXDORF
Cash recycling ATMs give financial institutions the power to control their entire cash management process from end to end. We sat down with Volksbank Albstadt’s Head of Facility Management, Joachim Schmalzl, to discuss how the bank successfully implemented recycling—and how their cash cycle was transformed as a result.
Diebold Nixdorf: As the financial ecosystem increasingly moves into the digital space, what trends are you seeing in cash levels at your organization?
Joachim Schmalzl: We do not see a change in our retail customer base or with our private customers. The cash in circulation in our region remains at a consistently high level. Retailers here have used cash recycling systems to deposit their earnings for quite a few years. And deposits on dedicated cash recycling systems (CRS) are, on average, about 400.000 – 500.000 Euros per day.
DN: What led you to explore cash recycling?
JS: The fact that our self-service systems are approximately equally filled as emptied by our customers made us interested in taking a closer look at our cash management. And it was worth it: With the decision to do cash recycling on our own instead of using a CIT-company, we saved one complete work step.
DN: You recycle cash in your branches and through the self-service channel. How does it work and what are the benefits?
JS: We are a certified cash recycler through the German federal bank, which means that our ATMs are certified and our processes are certified as well. If our customers deposit money, we can either recycle it or have a CIT pick it up and bring it to the federal bank. We have decided to validate and recycle the money on our own.
After a note validation, the money is sorted directly into cassettes. This is done via back office TCR. Thanks to our homogeneous self-service infrastructure, we are able to swap standardized and intelligent note cassettes from an automated teller system (ATS) to an ATM and CRS and vice versa. That means from A to B, from B to C or from C to A whatever necessary. The cassettes do not need to be manually checked or opened, they are simply placed in a docking station which displays the status the money inside.
The sealed cassettes stay, on average, about four weeks unopened in circulation. Once or twice a week, storage cassettes are filled and afterwards placed on a docking station to check the status. If the status displayed is “OK,” the cassettes are inserted directly into the next system without being opened. Due to revision reasons, we open the cassette after one month and count the cash. We choose this timeframe on our own, and other FIs could determine a timeframe that works for them. In our case, we chose monthly reviews so that if something goes wrong, we still have access to all data and protocols from the data processing center.
DN: How has recycling optimized your cash processes?
JS: The standardized, intelligent cassettes save us time and money. Now, we only need to check 341 cassettes out of 2,612. At an average 39 hours per week, this corresponds to savings of about seven working weeks within a time frame of 26 weeks. Today we deliver cash to 13 branches and eight self-service branches on our own instead of contracting a CIT. We do our deliveries with “normal” cars that are much more inconspicuous. Plus, our branches are alarm and video protected Apart from one system in a shopping mall, we manage the cash supply of our systems on our own. This has helped us to eliminate 500,000 Euros in CIT costs per year.
Additionally, our employees at the counter are almost completely freed up from cash handling activities, which gives them more time for consulting with customers. Because we’re self-sufficient from a cash supply perspective, our organizational processes have transformed: The departments for cash management, facility management and logistics now handle cash management. The main cashier is now part of the back office instead of sales. This change has freed up our employees from manual cash handling tasks and gives them more time for serving and consulting customers.
DN: What are the key takeaways for financial institutions considering recycling technology?
JS: I would not change a thing and would repeat the project exactly how we did it. I do recommend to start small with a pilot, to get familiar with the technology and every detail, and then slowly roll out the concept of looped cash cycles step by step to other systems and branches. Trust in technology is essential. In the first phase of implementing recycling, we filled the cassettes with cash and automatically checked them at the docking station to ensure everything was okay. We did that to gain confidence in the changed process and in the technology. We also found that our staff needed to be well trained to recognize immediately if something goes wrong to guarantee a continuous and available cash supply for our customers.
Are you interested in more examples of how banks around the globe are successfully rethinking their self-service strategy? Get real-world advice and insights from banking executives in our new guide, Self-Service Reloaded.