Virtual Tellers And Workhorse ATMs: Banking’s New (Digital-First) Normal

The prospect of restarting the economy of bringing all manner of everyday life in the U.S. back to some semblance of “normal” has challenges — and opportunities for banks, especially community banks and credit unions.

The challenge lies with serving the needs of the individual who may be hesitant to go back to the old ways of banking — of walking up to teller windows, of handling cash in envelopes.

The opportunity, Doug Brown, senior vice president and general manager of NCR Digital Banking, told Karen Webster, lies in embracing a “digital-first” mindset that can create a better experience — even a touchless experience — for consumers.

Call it a way to be physical even while being virtual.

As Brown told Webster, “It is the digital platform that can enable that change. When we look at everything that has been leveraged and assembled quickly — and in responding to what is clearly unprecedented demand for different services across digital channels — what stands out is the flexibility and agility of the underlying platforms.”

The ability to bring new services to market, to pivot quickly, will be critical as states begin to reopen across the next few months.

In many cases, the physical worlds in which we do business will be altered, perhaps permanently, in the wake of social distancing.

The Interactive Teller

Brown said there had been examples of a shift toward digital-first use cases already taking root. He noted there’s been a significant increase in demand for interactive teller machines (ITMs).

That demand had been significant even before the coronavirus hit in 2020, he told Webster, because they’ve allowed banks — especially smaller banks — to reap the cost benefits of flexible workforce management, and the ability to service machines during off-hours.

Now, he said, “the need for a platform like this is more important than ever.”

Brown recounted that branch hours had been restricted if branches are operating at all. He said there had been a continued embraced of drive-thru services at banks, and a continued desire by consumers to have at least some human interaction as they conduct transactions or address their daily financial needs. The shift toward interactive tellers, he said, allows customer demand to be satisfied while allowing staff to work from home.

Reinventing The ATM

Banking in the post-pandemic age, and with a “digital-first” mindset may also see a reinvention of the ATM, said Brown.

The ATM may indeed become a “workhorse” piece of technology on site, with capabilities expanded well beyond the confines of just spitting out cash.

Combined with virtual teller functionality, he said, banks can effectively adopt a “branch anywhere” deployment that can serve a variety of new use cases.

The evolution of the ATM depends on a shift toward what Brown termed a “two-way model” that allows users to not just “get things out” but “put things in.”

He said there always may be the need to withdraw cash, but consumers will also want to deposit funds into various accounts and manage currencies.

Safely and hygienically, of course.

Brown stated that NCR and other firms have been focusing on a “touchless” environment that can eliminate the need to punch keys and insert cards, using voice inputs or codes scanned from mobile devices.

“We can look at mobile and mobile apps, for example,” he said, adding, “The only thing I’ve touched would be my own device, but I’m passing information through a secure session” through tokenization, biometrics and other safeguards.

Leveling The Playing Field

One side effect of the pandemic has been to level the playing field between big banks — the behemoth and marquee names of financial services — and their smaller brethren.

The recent (and ongoing) scramble for small business loans as part of the Paycheck Protection Program (PPP) has spotlighted a huge opportunity for forward-thinking financial institutions (FIs). With platforms like Zoom, people can talk online to loan officers and do the things they usually would do across the desk.

Smaller banks and credit unions, said Brown, are cementing the bonds that have been shaped with small business clients forged over decades. It’s no secret that the rocky start of the Small Business Administration’s PPP has shown the value that lies with the personal touch.

As Brown noted, as many as 20 percent of PPP loans offered by these smaller FIs have gone to net new clients, which indicates these small- and medium-sized businesses (SMBs) are actively seeking guidance and reassurance through the process.

“The credit unions, even if they weren’t doing business with these firms,” said Brown, “well, they’ve always been there. They’re still known, they’re still trusted entities, right in the community.”

Using Artificial Intelligence

A digital-first mindset means FIs must anticipate their customers’ needs — and in the limited phase-ins of physical, branch-based banking that lie on the horizon or in online settings, time is precious.

Banks will, increasingly, need to leverage advanced technologies such as artificial intelligence (AI) to deliver services proactively and efficiently.

Using the example of PPP loans, Brown said joint efforts between credit unions, technology firms and NCR could give rise to “intelligent forms” that can alert SMBs as to whether they are missing information, or how far along the process they are.  Otherwise, it’s a hit or miss endeavor.

“Sometimes it’s the simple things that are needed,” he said, adding that once we emerge from the pandemic, no matter the use case in financial services, “we won’t go back to the old normal — so how do you address the new normal?”