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<p>BOSTON – ATMs are making a comeback-at least that is what a Dove Consulting 2002 ATM Deployer study finds. The survey, sponsored by the nation’s four largest EFT networks STAR, PULSE, NYCE and CO-OP Network shows that the ATM industry is “returning to a state of equilibrium”. “After the surcharge boom years, the industry experienced a period of transition with declining volumes per ATM, increased competition and declining profitability,” said study author Tony Hayes. “Now we are seeing the industry come full circle: from customer service-based to profit center back to customer service focused.” The survey also finds that while banks are planning to prune their ATM fleets by either relocating poor performing terminals or by removing the ATM altogether, credit unions will continue to place ATMs at a steady pace. In 2001, on-premises ATMs attracted 4,479 transactions per month while off-premises ATMs operated by a financial institution yielded 1,918 transactions per ATM per month. Independent Sales Organization terminals generated an average of 600 transactions per month. With location as the single most important determinant of a particular ATM’s usage, deployers expect volumes at on- and off-premise ATMs to grow modestly over the next two years. “In every sector, we found deployers in the midst of changing their ATM business strategies,” said Hayes. As for what the “hot spots” will be, Hayes says old favorites like gas stations/convenience stores will remain the most popular channel for retail ATM placements, followed by supermarkets, schools and malls. Also the study found that 50% of large financial institutions want their ATM channel to provide a more personalized experience and plan to incorporate Customer Relationship Management technology into the ATMs. And what about those pesky surcharges? The survey found that the average surcharge for an off-premises cash withdrawal rose 9% from $1.36 in 1998 to $1.48 in 2001 yet despite the fees, many deployers continue to operate their ATMs at a loss. Large credit unions with over $500 million in assets seem to be paying the most, but according to Hayes the high monthly costs for ATM deployment had a lot to do with their ATM fleet size not being large enough to save on economies of scale. In addition, Hayes attributes the typical credit union practice of outsourcing cash replenishment; daily collections from deposit-taking machines; and cash management procedures for the spike in credit union costs. Large credit unions paid an average of $1,688 a month for on-premise ATMs and $1,624 for off-premise ATMs last year; compared to $1,349 and $1,534, respectively, for large banks; $1,140 and $1,111 for small banks; $1,336 and $1,165 for small credit unions, and $1,068 for large ISOs and $732 for small ISOs for off-premise ATMs. The 2002 ATM Deployer Study was conducted in Fall 2001 and 127 deployers in all geographic regions of the United States were surveyed. As of August 2001, the respondents had a combined ATM base of 82,188 terminals representing approximately 25% of the 324,000 estimated total installed U.S. ATMs. [email protected]</p>

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