Cash to fund branches and ATM locations is a large noninterest earning asset, but managing that lifecycle can be a complex task. Some credit unions often keep too much cash on hand, more than 20% on average, which can cut into investment opportunities, according to Atlanta-based CetoLogic, a software and analytics services firm.
“As investment rates and long-term interest rates begin to ascend, it is critical that credit unions tap into their balance sheet to identify non-earning assets such as branch and ATM cash,” said David Austin, vice president of CetoLogic, adding implementing a vault cash management tool reduces cash levels by an average of 15% to 25%, and cash delivery costs are pared by about 15%,
By using CetoLogic’s C3 Financial, a Web-based cash forecasting application, the $810 million Credit Union ONE in Ferndale, Mich., has streamlined the cash management process for its 17 branches, said Cathy Burnham, a finance specialist at Credit Union ONE.
The tool has also reduced non-earning cash by an average of 15% to 20%, she noted.
C3 Financial's charts enable users to easily monitor cash flow.
Utilizing the platform for branch and ATM cash ordering has enhanced its order processing and monitoring efficiency, while accurately reducing the amounts of cash kept on hand, Burnham explained.
“As a result, we have seen a reduction of required courier services to our offices, decreased cash required in our branches and lowered our costs with the Federal Reserve,” she said.
C3 Financial, previously known as the Ceto Cash Calculator, has been on the market for a decade, the company said. CetoLogic recently introduced C3 Financial’s Ceto Cash Box Manager App, developed by the $1.1 billion Greylock Federal Credit Union in Pittsfield, Mass., to simplify the process of extracting required cashbox information from the Fiserv Open Solutions’ DNA platform.
“The app’s integrations and Greylock’s relationship with CetoLogic has enabled (it) to keep cash inventory aligned with demand and lower cash levels,” said Kevin Zimmer, chief information officer at Greylock.
The $1.3 billion NASA Federal Credit Union in Upper Marlboro, Md., has also launched C3 Financial, said Kristal Ribblett, assistant vice president of branch operations, to help understand the needs and cash demands of its more than 85,000 members.
The $1.3 billion Public Service Credit Union in Denver has used Datawatch’s Monarch Pro enterprise to optimize internal processes, including cash handling for its 67 ATMs and 30 branches. In-house work that was outsourced to cash vendors has resulted in annual savings of almost $500,000 from branch cash management and $55,000 in ATM cash management, said Amanda Hamm, PSCU’s efficiency officer.
Meanwhile, the $382 million Pima Federal Credit Union in Tucson, Ariz., said it avoided spending $160,000 on new cash-dispensing machines thanks to the Ariz.-based Cash Flow Management Inc.