Blog: Managing the ATM Channel Cost-Efficiently

Like all other channels, the ATM network requires robust management and continuous innovation to deliver new services and a high-quality experience, along with necessary adjustments to meet new regulatory standards and security threats. All this comes at a cost. However, FIs can control spending and ensure their self-service channel benefits from significant cost-efficiency gains by making the right technology and operational choices.

Turn Compliance and Security into Cost-Saving Opportunities 

Keeping ATMs compliant and secure is often seen as a regulatory burden, but it can actually unlock efficiencies:

• Always-on compliance reduces audit costs and avoids fines or penalties.
• Standardized, automated updates cut the time and effort needed for fleet monitoring and maintenance.
• Stronger security not only prevents fraud losses but may also lower insurance costs and, most importantly, protect customer trust.

The price of a breach — from lost customers to costly PR campaigns — far outweighs the investment in proactive compliance and security.

Cut the Single Biggest Driver of ATM Costs: Cash

Cash handling accounts for up to 50% of the total cost of ATM ownership. It encompasses interests tied to immobilized capital, cash-in-transit (CIT) services, and in-house management of the cash cycle. A no-brainer approach to reducing the cost of cash is to benchmark service performance and costs of your CIT provider(s) to ensure you keep getting the best service performance for the fairest cost. However, financial institutions can unlock bigger savings with smarter strategies:

• Optimize cassette configurations across the ATM fleet. By analyzing transaction data at each ATM, FIs can implement flexible, location-specific setups that minimize residual cash and further decrease cash handling interventions.
• Deploy cash recycling hardware with high-capacity, configurable cassettes to future-proof your fleet. Enabling SMB deposits through cash recyclers removes the financial burden of maintaining deposit-only solutions and eliminates any branch staff involvement in the processing of deposits.
• Enable cash recycling to allow deposited notes to be dispensed to customers again. This seamless process creates an efficient and cost-effective cash cycle, streamlining cash operations and significantly reducing the total cost of cash ownership.
• Finally, advanced cash order planning through AI-led, data-driven cash forecasting helps reduce cash handling efforts and CIT costs by right-sizing load schedules. It also minimizes idle cash stocks, lowering capital costs and insurance premiums.

Stop Paying Unnecessary ATM Transaction Fees 

Too many FIs are still routing every ATM transaction through card schemes — even for their own customers. That’s changing. With modern cloud-native, microservices-based software, FIs can route on-us transactions directly to their core. This eliminates unnecessary scheme fees, reduces processing costs, and enables reusable services across multiple payment rails for better cost control.

Innovate Faster and Cost Efficiently

With consumers asking for new functionality and truly omnichannel journeys and experiences, bridging physical and digital channels is essential today. Many institutions realize that migrating from a legacy infrastructure will be resource- and capital-intensive. Outsourcing the heavy lifting to a partner already invested in a future-ready cloud-native infrastructure can enable them to innovate faster, minimize upfront CAPEX, and modernize the customer experience without overwhelming budgets.

Streamline Operations with Managed Services

Managing the self-service channel in-house often means dedicating significant time, resources, and investment into building and maintaining expert teams. On top of that, there’s the ongoing expense of infrastructure, management tools, hosting, and maintenance. A managed services operating model changes this dynamic: by outsourcing end-to-end channel management, banks and credit unions can focus their resources (capital and people) where they matter most, while benefiting from economies of scale and predictable, transparent costs.

For FIs relying on multiple vendors to support ATM management, the challenges are familiar: systems that lack seamless integration, accountability gaps when issues arise, and the burden of juggling contracts and relationships. This fragmented approach can slow you down and drive up costs. By consolidating with a single, strategic partner who manages the channel holistically, institutions gain a streamlined, seamless experience—reducing complexity, improving accountability, and lowering costs across the board.

Supporting FIs as a Strong Partner 

Performance and innovation in self-service banking are most impactful when hardware, software, and services are designed to work together. At Diebold Nixdorf, we focus on creating that synergy. Our solutions are developed for easier, faster and cost-efficient deployment and lifecycle management - all supported with an efficient service model. 

We lead hardware technology through market-leading cassette capacity and configuration possibilities, with cash recycling enablement through a simple software update, enabling our customers to significantly reduce their cost of cash.

The same philosophy applies to software. With Vynamic^® Transaction Middleware, a cloud-native platform built for adaptability, banks can implement a host of reusable services and even process on-us transactions directly to their core. The result: faster innovation cycles and meaningful cost savings.

This isn’t theoretical. Today, we manage self-service channels for more than 1,000 banks and credit unions worldwide, helping them reduce operating costs by as much as 40%. The opportunity is clear: with the right partner, financial institutions can maximize efficiency in their ATM channel while continuing to deliver the reliable, secure, and seamless experiences consumers expect.

Would you like to know more about how our Branch Automation Solutions? Let’s start the conversation.