There are murmurs in the financial industry that the ATM couldbe a dying channel. With the proliferation of mobile banking,person-to-person payments and other remote channels, some feel thatATMs are useful merely as check depositories and cash dispensers,and even those functionalities w

But much like how we still have branches and paper checks, theATM channel is not going away. In fact, with the upcoming migrationto EMV, credit unions will have the opportunity to enhance theirATM capabilities and introduce fresh revenue generatingservices.

Complying vs. Strategizing

While deadlines for liability shifts and final implementationhave been laid out by the payment networks, the specific dates varybetween each organization and are widely perceived as a movingtarget. Nonetheless, EMV will become a requirement in the UnitedStates over the next few years and credit unions need to beginmaking plans now for how they plan to introduce the change.

It is important to remember that while EMV is one of manycompliance issues facing institutions, it is one that should beapproached not as a burden, but as part of a long-term paymentstrategy.

Fraud reduction is the clear leader in EMV benefits, but thetransition also provides credit unions with the opportunity toexpand the functionality of payment cards. With the additionalmemory capacity of chip-and-PIN cards, non-payment functions suchas loyalty programs, contactless payments and other member servicescan be leveraged to enhance the member experience.

Most compelling, however, is the chance to use the EMV migrationto make enhancements to ATMs that create new sources of income,offsetting the cost of compliance while plugging the holes left bydrops in interchange fee income.

Outside of the growing use of ATM check capture, machines in theUnited States have not been the target of innovation in quite sometime. Meanwhile, financial institutions in Europe and Asia havecontinued to focus on the channel as an important part of theirrevenue-generating and client service efforts. Recent upgrades tosome international ATMs include:

• Online Account Access: Members can access their onlinebanking accounts at the ATM in order to complete transactions suchas various fund transfers, bill pay and personal loanapplications.
• Donation Acceptance: During disasters and other timesof need, your institution can serve as an automated hub fordonation acceptance by enabling community members to give moneythrough your ATM network.
• Event and Lottery Tickets: Members can use the ATM topurchase tickets to activities such as concerts, sporting eventsand movies, as well as lottery tickets.
• Virtual Prepaid Cards: Any consumer can create avirtual card by either loading it with funds from an existing bankaccount or can insert cash into the ATM (in the case of cash-inATMs). The customer can then print a receipt that displaysthe value of the virtual card and all the details necessary whenmaking purchases online. These cards could be valuable tool toreach the underbanked, as well as those consumers wishing to avoidCard Not Present fraud.

Each of these services represents additional income for thecredit union through service and convenience fees. In addition, byoffering innovative functionalities at the ATM, the credit union isbroadening its exposure to potential members. From Ideas to Reality

An important aspect of expanding your ATM functionality duringthe EMV conversion is to take a close look at the member base todetermine which new services make sense.

What online banking services do they use the most? Howtech-savvy are they? What other remote services are seeing wideadoption? When the credit union deploys the new ATM services,members' transactions should also be tied back to the CRM system toenable targeted marketing at the device.

As you begin making the required ATM hardware changes to complywith EMV, take a look at your payment processor and card issuer aswell. These vendors should be well versed in EMV processing and notexploring the transition for the first time as you are.

In addition, many of the advanced capabilities are easier todeploy if you bring some or all of your ATM management in-house anddrive the devices yourself. This keeps the credit union from beingtied to one provider and limited to a basic menu of ATMfunctionality.

Select software providers that provide the necessary technicalassistance while giving the institution the flexibility and toolsneeded to create product offerings that improve experience fortheir specific member base.

StickingAround

For the foreseeable future, the U.S. will continue to rely oncash and therefore will need ATMs. The devices are becoming moreand more intelligent and offer endless opportunities for targetedmarketing and new services. Your ATM network should always be partof the conversation about a unified multi-channel experience andnot left in the dust for the pursuit of new trends.

Maria Nottingham ischief marketing officer of Compass Plus in Nottingham,England, and Miramar, Fla.