Cash use across the globe varies, but it remains a vital payment method. Cash is still the most-used payment method in regions like Africa, the Middle East and Latin America.
The decline that took place during the pandemic also appears to have reduced so that cash use in many countries appears to be staying level
1.
There are many reasons why people continue to use cash. While the availability of alternatives still plays a role in some regions where there is a lack of access to other payment methods, in many cases, paying with cash is a conscious choice of the individual:
- Trusted, convenient service
- Concerns about vulnerabilities of digital payment methods to cyberattacks
- To keep a better grip on their expenditures
- To protect their privacy
Also, fees incurred from non-cash payments make many small businesses rely on cash. Other factors like large-scale outages of payment infrastructure can take hours, days, or, in the case of Germany in 2022, weeks
2. Natural disasters, which have been happening more often, also prompt consumers to keep cash on hand, as do concerns about the conflicts in Ukraine and Gaza.
All of this is to say that cash will continue to stay relevant. The degree to which it is used in daily transactions may vary, though. For example, countries with high cash use include Thailand, Japan, and Spain, while countries like Sweden and the Netherlands have low cash use. Some governments have put programs in place to protect cash services, while others are introducing legislation to force access to and usage of cash
3.
This variety poses challenges to financial institutions that will continue to be required by consumer demand and/or law to provide access to cash. Efficiently offering cash services will likely be one of the biggest challenges. Cash automation at the self-service channel has proven to be an effective method globally, but with the differences between countries and regions, there is no one-size-fits-all model. The self-service channel has gained importance as a channel for the efficiency of many branch transformation journeys. Efficiency, availability and security are the main drivers for the branch transformation. Cash-heavy markets will have different requirements than cash-light markets, and others may be in between. Consequently, each may be best served by different devices – or by one that is highly flexible. Independent of the existing model, cash recycling can provide the needed flexibility, but there are still some differences in what each model will require.
A workhorse in a cash-heavy market
In a cash-heavy market, there are many notes in use, constantly changing hands during the various transactions that go on every day. While a cash recycler is refilled by consumers depositing their cash into the device, it will be a good choice to use one or more devices with a high capacity to fulfill the high number of withdrawals throughout the day. Many deposits will come from cash-heavy small- and medium-sized businesses depositing their earning at the end of the business day and refilling the machine for the next day. To reliably serve such a high number of transactions, devices will need high availability to avoid out-of-service events – and many financial institutions are combining the ATM with a service contract from a provider that includes preventive maintenance to catch errors before they occur.
As a cash-heavy society will place greater value on cash services, it will also likely allow its ATMs to take up more space. This offers an opportunity for recycling installations with DN Series
® dual tower where the highest-capacity single tower is not enough.
A master of flexibility for a cash-light case
There will likely be fewer transactions in a cash-light society, but the volume of withdrawals and deposits may be higher. So, the requirement for capacity will not be as high but should not be calculated too low. As the number of transactions is lower, the cost per transaction is increasing, so it’s important to have a device that works efficiently and has as little need for intervention as possible. This includes both service and CIT interventions. A well-adjusted configuration of the cash cassettes can extend refill cycles considerably, while reliable engineering and the right service model can extend maintenance cycles. Flexibility regarding the choice of denomination can also help increase consumer satisfaction. In some installations, for example, at the border or in transportation hubs, an ATM may also be equipped with different denominations and currencies and offer foreign exchange to generate additional revenue. Additional components like ID or passport scanners and sign pads can further extend the transactions that can be migrated to the ATM, relieving bank staff from low-value-added tasks.
In this scenario, a smaller device that can enable as much functionality in a footprint as small as possible will be preferred as branches will likely also be fewer and smaller. Many may follow a cashless branch concept where all cash transactions are migrated to the self-service channel either in the branch or off-premises. Offering a variety of different installation options will be beneficial for fitting into different locations where footfall is already high.
You would think fulfilling these different requirements would require entirely different solutions, but with the DN Series family of ATMs based on Diebold Nixdorf’s in-house cash recycling technology, it is possible to fulfill either requirement. Thanks to the flexibility and high quality of our fourth-generation cash handling technology and the modularity of the DN Series, we can offer a solution for every requirement in every market.
If you’d like to find out more, visit
DieboldNixdorf.com/DNSeries.
Sources:
1 https://www.cashmatters.org/blog/2023-payments-report-confirms-cash-is-essential-to-economies-worldwide
2 https://www.tagesschau.de/wirtschaft/digitales/verifone-h5000-stoerung-behoben-101.html
3 https://www.cashmatters.org/blog/2023-payments-report-confirms-cash-is-essential-to-economies-worldwide
