The banking industry has transformed rapidly over the past few decades. While demonetisation fastracked digitalisation of traditional bank branches, banks are now installing various
The banking industry has transformed rapidly over the past few decades. While demonetisation fastracked digitalisation of traditional bank branches, banks are now installing various self-service kiosks at its branches to reduce the burden on tellers and enhance customer convenience. One such self-service kiosk is the Cash Recycler Machine or CRM.
The USP of a CRM is that, in addition to enabling cash withdrawals like an Automated Teller Machine or an ATM, it allows the bank customer to deposit cash in the same machine. For instance, when a customer withdraws cash from an ATM, the amount is instantly debited – likewise, when a customer deposits cash through a CRM, the amount is credited real-time. A customer has two options to deposit cash in the machine – 1) By using a debit card and 2) By entering the bank account number.
Let us understand how a CRM benefits both customers and banks:
- It saves time & increases overall efficiency
A cash recycler machine automates the cash handling process by validating, sorting, storing and further dispensing notes. This negates manual intervention and saves time. Since the deposited notes are recycled and processed for withdrawals, CRMs also reduce cash replenishment trips.
Cash handling process previously would involve the exchange of many hands, thus increasing the chance of shrinkage. With the automation that a CRM offers, the chances of human error are mitigated, and efficiency is improved.
- It helps in optimising operational costs
A CRM performs both functions – cash deposit and withdrawal. Therefore, it helps bank optimise the overall costs. It also reduces the burden on physical tellers, allowing banks to focus on improving customer experience. In fact, it is expected that every new bank branch that opens may house at least one on-site ATM and a CRM. This is because a bank branch incurs a cost of about INR 60 for processing a cash transaction and with the installation of CRMs this cost is reduced significantly, thereby ensuring economies of scale for acquiring banks.
- It is a potential tool to reduces counterfeit currency in circulation
CRMs are enabled with RBI-supported note identification protocols and mechanisms, allowing them to detect fake, soiled, and counterfeit notes. Such notes are not accepted by the machines, thus preventing them to enter the mainstream banking channel.
- It can potentially improve availability of cash in tough geographical terrains
Since CRMs recycle the deposited cash and dispense the same denominations for withdrawals, it reduces the downtime of ATMs. This is extremely beneficial in tough geographical terrains where the cash replenishment cycle is longer or tougher. In tier-4 and below towns, a CRM can be blessing as customers do not have to wait long hours or days together for withdrawing cash.
- It increases customer convenience
Depositing money in a traditional bank branch entails standing in long queues, interacting with tellers and filling deposit slips. For new-age customers and even senior citizens looking for convenience, CRM is a boon. It has no manual intervention. A customer has to simply walk into a bank branch or e-lobby with the cash, enter his/her details on the CRM machine, insert the cash in the slot and confirm. The money is deposited real-time – in minutes, making it more convenient for customers. With interoperability of CRMs, now customers can walk into any CRM, irrespective of the bank and complete the cash deposit process.
Additionally, we are likely to see an increased deployment of CRMs – given the RFPs already floated in the market. CRMs will also be a key element in Digital Banking Units set up by Scheduled Commercial Banks. This self-service terminal will continue gaining momentum as it will reduce banks’ operational costs, improve efficiency and increase customer satisfaction.
AGS Transact Technologies Ltd., one of the largest integrated omni-channel payment solutions providers in India, in terms of providing digital and cash-based solutions to banks and corporate clients, manages 4,704 CRMs under its banking outsourcing segment (as on September 2022).