The worldwide ATM Market (Automated Teller Machine Market) is projected to garner over USD 26 billion by 2024, growing at around 9.8% CAGR in the forecast period (2016-2024). It had a value of USD 12.5 billion in 2015. Technological breakthroughs and innovative security standards amid growing wireless devices should propel the market in the near future. This can lead to lesser frauds & safer financial transactions.
ATMs are actively encouraged by banks & other financial institutions. These machines help clients make cash withdrawals, transfers, and deposits. They are adopted widely since they offer various alternatives for financial transactions.
Online cash transfers and other modes of transaction are the obstacles in ATM market. The development of solar and smart ATMs in India and China should give growth prospects to the industry and lower the functional costs of devices. These devices allow easy & convenient cash transfers. Escalating competition among banks to grow their client base will add market fillip. Firms are increasingly choosing voice recognition systems, biometric devices, & anti-skimming devices to decrease frauds.
Solar-powered ATMs are the latest breakthrough. They serve clients who are unable to access ATMs across electricity-strapped regions. Stanbic Bank, a part of Standard Bank Group, has installed eight machines in Ghana. It plans to install 20 more in the coming years. Power is supplied to these machines via 16 solar panels; comprising a battery bank, air conditioners, and CCTV cameras.
The ATM market is fragmented into solutions and regions. Solutions include deployment and managed services. Deployment has made it possible for clients to avail around the clock banking services. These solutions accounted for 70% of the total shares in 2014. This was ascribed to rising IT companies globally. They earn from installed machines and their services.
Installation of ATMs and their maintenance will drive segment growth. Deployment is sub-fragmented into worksite, onsite, offsite, & mobile ATMs. Worksite is expected to produce over USD 2.6 billion by 2024. Onsite machines are installed within banks. They mitigate staff pressure and reduce the probability of errors. These factors should propel segment demand till 2024.
Mobile machines can reduce customer queues at trade fairs, social gatherings, and sports events. They will grow at a CAGR of nearly 13% over the forecast period. This sub-segment provides banks a chance to extend their worldwide reach and decrease traffic congestion. It promotes flexibility & banks’ brand awareness. But investments in mobile van ATMs, security, and network connectivity pose challenges to mobile ATMs.
Offsite machines are placed at larger distances from banks. As of January 2016; the Reserve Bank of India (RBI), a premier financial institution based in India, has allowed offsite machines to offer the features of onsite ones. The State Bank of India, one of India’s top-rated banks, has launched mobile van ATMs at prime locations in the state of Tamil Nadu. This permits easy cash-withdrawals by month end or during salaries being credited to bank accounts.
Managed services enable banks to outsource their non-core operations to trained service providers & focus on key businesses to maximize the profits. They are engaged in customer-management and cross-sales prospects. This segment is likely to grow at a CAGR above 11% in the next eight years. Its outsourcing should bring decent returns and lower the expenses, all of which would comply with latest governmental policies. Companies; like Diebold Inc. and Wincor Nixdorf AG provide similar services at low costs.
Regions covered in the ATM market are North America, Asia Pacific, Europe, and the Middle East & Africa (the MEA). North America reigned in 2014 but will face a decline later. It captured over 35% shares in 2014. Its trend of ‘digital currency’ trading has prompted the usage of Bitcoin machines in the region. Higher functional costs in the U.S. have resulted in service providers employing other solutions. The U.S. is the finest performing regional country.
The incorporation of video conferencing, biometrics, & remote assistance will propel North American revenues. U.S. banks have enforced Europay/Visa/MasterCard IC (integrated chip) encryption to ensure more safety.
Europe would observe trends akin to North America due to broader penetration and rising operational costs. MEA and Asia Pacific should record significant expansion till 2024. This can be ascribed to high consumer demand and regulatory aid for electronic banking. More than a million ATMs are projected to be installed worldwide, with over 800, 000 in Asia Pacific.
Asia Pacific is estimated to grow at a CAGR over 12% from 2016 to 2024 due to its self-service machines and ever-increasing customer base across China, Indonesia, Vietnam, & India. Countries; like Russia, Brazil, Iran, and Nigeria may also witness high demand. Singapore currently offers ‘SMART gold ATMs’ that dispense currency in the form of gold ingots and bars. These machines even allow the withdrawal of gold ingots, ranging from 1-20 grams.
The MEA would experience massive expansion due to its cash-based economy and client demand. Increased reliance on IT has driven global industry firms to introduce devices with multiplatform compatibility. Notable players in the worldwide market encompass GRG Banking, Nautilus Hyosung, Euronet Worldwide, NCR Corporation, and Diebold Inc. Manufacturers & suppliers aim to meet new customer tastes. Firms have been working on cost-savings, functional efficacies, and client-services. Mergers and acquisitions are employed by companies to expand their businesses. For example; Euronet acquired Pure Commerce in 2013 to widen its reach.
Diebold Inc. launched the new 5500 series machines in 2014, equipped with biometric readers & security cameras to increase its product portfolio. It also developed a new card reader, termed as ‘ActivEdge’ that year that reportedly thwarts card skimming for the maintenance of customer data. It needs users to insert cards via the horizontal edge, preventing card fraudsters from reading magnetic stripes.
Robust emphasis on dependency & quality exists due to performance needs. The future of this industry depends on its compatibility with smart phones & tablets that enable transactions to be conducted online or on the go. Dominating companies are highly proficient and believe in the constant delivery of advanced products & customer-friendly services.
Research Support Specialist, USA