21 May 2018
RBR’s Self Service Banking Europe 2018 in review
This week saw our now annual pilgrimage to the Royal Lancaster Hotel in London to check back in with our friends at RBR to see what, and who, they have brought together from the ATM and Self Service industry and what insights will be shared.
Having keenly followed #SSBE18 in the build up to the event I could not wait to hear more about the growing wave of new technology in the industry and how innovation can help the continuing drive for efficiencies along with securing the long term future of the channel.
So, without much further ado, here are my thoughts on the common themes that emerged through the two days of RBR.
1) Adapt to Survive
Straight off the bat, the opening keynotes provided an overview of a common theme that we would hear in many sessions – namely that the shifting dynamics of society is changing the role of the ATM and, as providers, if you do not adapt away from a “we have always done it this way” approach then you may not be able to keep pace in an ever changing world. The phrase that struck home for me was “nobody wants to be Nokia in a world of Apples”.
We have, of course, heard this before but the pace in which changes are coming is speeding up and providers need to think about what may happen in 20 years from now in order to stay relevant. A counter point to this was raised by Danske Bank, that whenever we are looking to the future unless it is more convenient to the customer, adoption rates will be low. The exact phrase was “things” will not replace cards. This leads us nicely into the next point…
2) Evolve a Frictionless Customer Journey
“Digitisation alone is not enough”, it was a simple message from Diebold Nixdorf but certainly one that emerged a number of times throughout the two days. The easiest way to adapt to survive is to concentrate on the customer. What has been understood in the industry for a couple of years is that demand for cash is falling, this coupled with the proliferation of mobile banking in the market has led to a reduced demand for ATMs. A number of speakers talked about how they focused on the customer when re-engineering a solution or how they transformed their branch experience, and in each of these examples the speaker highlighted the positive impact an improved customer experience had on their profit margins.
It’s a simple mantra, but very telling – banks need to focus on the end state as opposed to short term fixers that only benefit shareholders. Obviously this is easier said than done but if we try to elevate and enhance the customer touch points, again a very simple message from Diebold, then there should be benefit to both customers and the shareholders.
3) How can we make Self Service banking into the digital world
It was good to hear about the waves of innovation in the industry with a number of people talking about topics that have been buzzwords in the Fintech coffeehouses of Shoreditch for the past couple of years. We had the president of SLDNXT from Canada talking about the positives and negatives of Big Data and Jochen Werne talking about the impact of AI on the self service industry.
The new wave of technology driving change at the ATM was also nicely summed up by one of our colleagues from Mastercard, Dan Goodman, SVP of Product Management for ATMs. He highlighted that the customer expects to be able to interact digitally with the ATM and outlined some of the solutions that Mastercard are working on to deliver success in this space.
It was an interesting point to note, is that as consumers we currently expect to be able to transact at any ATM, however some of the new digital solutions that the banks are investing in can only be used for “on-us” transactions. I can see why they are doing this, brand loyalty is key in banking, but it was nice to hear a different approach from Mastercard who are using their network to enable the product at all ATMs, for all customers.
It will be interesting to see how this plays out over the next few years.
4) How would the ATM work in the Shared Economy
Perhaps the most common theme of the two days was the talk about how aspects of ATM provision can be shared between a number of providers. In fact, there was an entire stream devoted to the concept of Pooling and how that has worked in a number of markets.
We heard from Monese and how they are leveraging the Post Office branch network to give their app-only customers access to cash for the inevitable time these customers need to use physical money.
We also heard from Vocalink’s own Andy McGonnall, Head of Product Management for Card Transactions Services, who was presenting in the “New Models for ATM deployment” stream. In this session Andy presented an insightful look at how to drive efficiencies while maintaining customer service. Where the concept of a share economy or pooling can help is in the need to address an operators cost base, especially as revenues decline. We obviously have lots of experience in the outsourcing space and it is clear the world of ATMs and Self Service is evolving and operators need to keep up in order to meet high financial targets.
5) More talk of ATM Pooling
As mentioned, another way to drive down costs is to look at ATM Pooling. The concept has been around for a while but this is the first time I have seen a specific section of a conference dedicated to it. We heard from RBR themselves on where they are starting to see pooling emerge and what impact it has had on those markets. The key take home for me from this conversation was around how much control the pooled ATM operators want to retain if they outsource to a single provider. Clearly the greater the co-operation between the pool operator and the bank then the less control the bank has – to do this the banks need to agree on a shared vision for success.
We also heard from the product director from Bankomat in Sweden, who run the country’s ATM pool, and their model of ATM Sharing. What was clear is that the banks in Sweden certainly have signed up to a common vision of what ATM provision looks like and Bankomat have provided clear strategic alignment, providing cash optimisation, a modernised architecture and a centralised set of human resources.
For this market, standardisation is key – is that the same in other markets? Possibly not, a one size fits all solution will not work everywhere so it will be interesting to see what happens and the differences that emerge.