Facility Solutions: Personal Teller Machines

Questions to help you decide how video transactions could impact your brand and bottom line.

by: Paul Siebert, CMC

Most credit unions need branches today and well into the future to provide competitive convenience, tangible branded differentiation and a physical place to build relationships. At the same time, today’s branches must be less expensive and more productive, which requires new business models and branded experiences.

Personal teller machines, aka interactive teller machines or video tellers, are allowing credit unions to transfer physical transactions out of the branch to a call center. Based on the math alone, PTMs seem to be a solution that will drive viable financial branch models by reducing branch space and staff by 40 percent to 70 percent, while continuing to support the same level of deposits and loans.

While the popular trend is to evolve to PTMs, some credit unions and banks feel PTMs are only a temporary solution that could do more harm than good. At a recent banking conference, I learned of a number of institutions that are deciding to jump the “hype cycle” of PTMs. The rationale is that transactions are declining at the rate of 5 percent to 8 percent per year. Eventually, the vast majority of transactions will be conducted through mobile channels. Then what will we do with all these expensive machines? (PTMs can cost $65,000 to $85,000 per unit.)

The right answer concerning PTMs is different for every institution. Some credit unions are planning to convert all their branches to PTM transactions. Others are looking at a mix of branches using personal cash transactions in some markets and PTMs in others. And a number are just saying “no” based on the answers to five key questions:

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