- City Fajr Shuruq Duhr Asr Magrib Isha
- Dubai 04:55 06:08 12:11 15:32 18:07 19:21
Manufacturers put new features in ATMs that can help banks cut costs. (EB FILE)
Automated self-service systems makers NCR Corporation and Diebold are poised to see continued demand in their automated teller machine business as they pack new bells and whistles onto their ATMs.
“The way (these) companies are going to maintain their revenue close to what it was last year has a lot to do with making the maximum out of the demand for ATMs,” Wedbush Morgan Securities’ Gil Luria said.
NCR and Diebold are loading their ATMs with features such as deposit automation technology and bulk check deposit capability.
Deposit automation facilitates “no-envelope” deposits of cash and checks through customer-operated ATMs, and bulk check deposit capability helps customers deposit large numbers of checks and currencies.
Analysts expect the new features to drive growth for NCR and Diebold this year, especially in markets such as North America, Eastern Europe and Asia.
NCR, which dominates the $6 billion (Dh22bn) global ATM market with a market share of close to 30 per cent, grew about eight per cent to 10 per cent in 2008, estimates Reik Read, an analyst with Robert Baird & Co.
Read said the financial segment will fare much better than retail, which is expected to fall about 25 per cent.
NCR gets about 50-55 per cent of its revenue from ATMs, which is expected to grow in 2009, said Wedbush Morgan’s Luria. He estimates Diebold’s ATM revenue to grow by about three per cent in the year.
Shares of NCR have fallen about 64 per cent in the last six months, dragged down by the decline in broader markets and weakness in its non-ATM businesses. Retail banks have their task cut out in this challenging environment, and the game plan is all about cutting costs and addressing competition. There, the demand for ATMs comes in play.
Banks are upgrading primarily to save money as features like deposit automation help them simplify their operations, Luria said.
ATMs also get transformed as single-kiosk marketing offices for banks as the additional features enable automated one-on-one interactions with customers.
“All of these initiatives have the direct ability to help the banking industry deal with their immense pressure to cut costs and to create enhanced loyalty and intimacy with customers,” NCR Chief Executive Bill Nuti said in a conference call.
Another scenario that is expected to provide a fillip to the ATM business is the large-scale consolidation that the banking industry has been witnessing.
“Demand in the regional accounts in the US, however, continues to weaken during the quarter. These banks remain conservative with capital deployment in this recessionary environment,” said Diebold CEO Tom Swidarski on a conference call with analysts.
Follow Emirates 24|7 on Google News.