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Meeting of the Month
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The UK Government has rightly made clear that it wants the UK Public to be able to deposit their cash at any ATM that has a deposit facility. In these days when the number of bank branches is fast declining, it is unrealistic - and very inconvenient - to expect those wishing to deposit cash to search out one of their own bank's ATMs to do so.
However, universal cash deposit at ATMs is only really a first step. What is truly needed is a network of Smart ATMs, strategically located around the UK and providing 99% of the services available at a staffed bank branch.
Every local community in Europe needs at least one Smart ATM and especially if there is no bank branch servicing the needs of residents.
Smart ATMs will provide many transactions and one of the most important is cash recycling. This is a progression from simply accepting cash deposits. A cash recycling ATM processes deposited notes, removing those that are damaged or dubious and makes available for withdrawal those notes which are fit for recycling to the public.
Cash recycling is convenient for ATM users and is also ultimately a cost-reduction measure. It cuts down the number of cash deliveries needed to ATMs and ensures that communities have some access to cash, even where for any reason a cash delivery fails to happen.
Any local recycling is good for the environment. Cash recycling can therefore be seen as helping the ATM Industry contribute to making our world a better place in which to live.
In some countries, all new ATMs which are being installed are capable of cash recycling. We urgently need to see this trend accelerate to include the UK and the whole of Europe.
The good news in the UK is that the LINK Network now has a Universal Cash Deposit transaction available to be used. All that is needed now is for all Issuers to adopt the transaction. After that, any ATM Operator can install machines anywhere to accept cash deposits from the customers of any Card Issuer.
It is clear that the UK Treasury is genuinely strongly interested in innovations, such as Cash Recyling at ATMS. This should provide impetus to the adoption of some exciting innovations in the ATM sector.
Ron Delnevo wrote to Hannah Nixon, CEO of the UK Payments Regulator(PSR) in late June 2017, asking for an urgent update on the adoption of Universal Cash Deposit in the UK and asking what Ms Nixon is doing to facilitate adoption. This LINK transaction is vital to the smooth circulation of cash in the UK. It needs to be adopted by all issuers so that ATMs will the requisite functionality can be installed in communities around the UK.
Despite several written requests for the Payment Systems Regulator to act, Hannah Nixon has so far failed to do so. Some people argue the PSR has been "captured" by anti-cash vested interests. There is,as yet, no evidence to the contrary.
Ron met with the UK Treasury in early September 2017 and again in January 2018, at which meetings he asked the Treasury to intervene to ensure this vital transaction is implemented as soon as possible on UK ATMs. He has also continued to apply pressure to the Payments Systems Regulator and LINK to get this transaction implemented,
There will be considerable media coverage of this hugely important issue in 2018, so the first Card Issuer to implement this transaction will attract massive positive publicity.
Which bank will be the "First Mover"?
WATCH THIS SPACE!
Payment Choice 2020: Maintaining Payment Choice in Europe
The ATMIA has been heavily involved in the Nordic Region in recent years, trying to help ensure that both ATMs and cash have a good future
Ron Delnevo appeared at the Nordic Finance Forum in Stockholm on 9 November 2017. His presentation focused on how SmartATMs can replace lost bank branches.
The ATMIA has also been fully involved in Finland, trying to stop the imposition of Disloyalty Fees on bank customers who choose to use non-bank ATMs.
The good news at the end of January 2018 is that the Finnish Financial Services Regulator has ruled out the imposition of Disloyalty Fees. THIS IS A BIG WIN FOR THE PUBLIC, INDEPENDENT ATM OPERATORS - AND CASH!
It means that it will remain economic for new ATMS to be installed to meet the cash needs of the Finnish public and businesses.
Back in Sweden, ATMIA is planning to attend a Financial Services convention in Sweden in July 2018 to support Payment Choice in the country.
Government intervention looked unlikely, until very recently. However the following article from Bloomberg, published on 18 February 2018, holds out some hope of government action
““No cash accepted” signs are becoming an increasingly common sight in shops and eateries across Sweden as payments go digital and mobile.
But the pace at which cash is vanishing has authorities worried. A broad review of central bank legislation that’s under way is now taking a special look at the situation, with an interim report due as early as this Summer .
“If this development with cash disappearing happens too fast, it can be difficult to maintain the infrastructure” for handling cash, said Mats Dillen, the head of the parliamentary review. He declined to give more details on the types of proposals that could be included in the report.
Sweden is widely regarded as the most cashless society on the planet. Most of the country’s bank branches have stopped handling cash; many shops, museums and restaurants now only accept plastic or mobile payments. But there’s a downside, since many people, in particular the elderly, don’t have access to the digital society.
Riksbank Governor Stefan Ingves has said Sweden should consider forcing banks to provide cash to customers. In its annual report on Monday, the Riksbank said the question is what role it should play in a future with even fewer cash payments.
“The Riksbank is carefully analyzing this development,” Ingves said. “Overall, I think we are facing structural changes in areas that have previously been stable. This is a development which will affect all the Riksbank’s departments and we will need to make strategic decisions regarding the way forward.””
“One may get into a negative spiral which can threaten the cash infrastructure,” Dillen said. “It’s those types of issues we are looking more closely at.”
We will keep you in touch with developments in Sweden as the year progresses.
EUROPEAN ADVOCACY UPDATE
Limitations on Cash Use in the European Union
The Europan Commission has sought views on whether there should be Europe-wide limitations on cash use.
The ATMIA has issued a detailed response which, in brief summary, is a resounding "NO"!
The ATMIA is now working with a broad coalition of interested parties from across Europe to coordinate responses to this threat to the Public Interest.
More news in 2018!
There are on-going discussions within LINK as to the appropriate level of scheme interchange that should apply to cash withdrawals and balance enquiries.
At least one Financial Institution that is a member of LINK is rumoured to want an average 20% reduction of interchange payable, to reduce their own outgoings.
Other members of LINK maintain that there is an established formula for the calculation of interchange and that a 20% reduction in the levels established by using this formula would result in many Free To Use ( non-surcharge) ATMs becoming uneconomic to operate.
Industry estimates are that as many as 8500 Independent Deployers ATMs may be deinstalled in the next 24 months should interchange be reduced by 20%. This amounts to about 1/3rd of the free Independent Deployers ATMs currently operated on the LINK network. In addition, there may well be many bank operated off-branch ATMs that will become uneconomic and need to be removed.
Removals of ATMs on the scale envisaged would severely damage the publics convenient access to cash and threaten financial inclusion. Almost everyone in the UK could be adversely effected but the impact would be particular keenly felt by those on lower incomes or state benefits, who use cash for almost all purchases and find that use a vital tool in their budgeting to live their lives from day-to-day.
The ATMIA is in discussion with a number of Association Members, the UK Government and Financial Services Regulators. The objective is to ensure that the LINK scheme continues on a basis that guarantees, at a minimum, maintenance of current levels of public access to cash and that the level of LINK interchange is set at levels which make the scheme sustainable on a long-term basis.
The ATMIA is working hard to ensure an outcome in the public interest and one that enhances the future role of ATMs and cash in the UK. Ron Delnevo was interviewed by Eddie Mair on BBC radio on 7 April. You can hear this here.
In November this threat has re-emerged, with proposals that LINK interchange be reduced by 20%. This would put 20,000 + free UK ATMs at risk. The ATMIA judges this proposal to be as against the Public Interest.
The powerful Treasury Select Committee, the most important Back-Bench Committee of the UK Parliament, has asked for an Independent Inquiry into LINK issiues. Which?, the Association of Convenience Stores,the Federation of Small Businesses and ATMIA have all supported this request.
Though LINK at the end of January announced a 5% cut in interchange on 1 July 2018, work continues to halt the arbitrary slashing of interchange.
MORE ON THIS VERY SOON!
Business Rates on UK ATMs
An appeal to the UK Courts to stop the Valuation Office imposing Business Rates - a property tax - on off-branch ATMs has so far failed. It is likely that this case will be subject of a further appeal.
The ATMIA fully supports the appeal. This tax threatens the economic viability of thousands of Free-To-Use ATMs providing convenient access to cash in local communities around the UK. This in turn threatens Financial Inclusion, because those who have low incomes or receive State Benefits cannot afford to travel to get the cash the need to live their daily lives. Millions of British citizens, who use only cash to manage their personal finances, will naturally be the most badly disadvantaged if Free-To-Use ATMs vanish from their neighbourhoods.
There is now also a danger that Business Rates will be levied on Internal ATMs.
The ATMIA is in touch with interested parties in the UK to determine what the next steps should be. More will emerge on this subject during 2018 and the following years. It is definitely a long-term concern!
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The ATMIA Europe Member of the Month for April 2018 is... Euronet Worldwide!
Europe should be very grateful to Euronet Worldwide.
When the Founders of the company - Mike Brown and Dan Henry - arrived in Budapest in 1994, there were no Independent ATM Deployers in Europe. In fact, there were not that many ATMs, so Mike and Dan found themselves with wallets full of plastic cards, but nowhere to use them.
Undaunted, they set up their company with the aim of establishing the first independent ATM network in Central and Eastern Europe.
It certainly wasn't easy - failure was a distinct possibility at various stages - but Euronet Worldwide ultimately prospered in a spectacular fashion. The company spread around Europe and then the World. Today, they serve clients in over 160 countries. Astonishingly, they are well on the way to the same coverage as the United Nations, which currently has 193 member states!
Euronet Worldwide is a diversified business now, operating in three primary business segments - Electronic Financial Transactions, Prepaid and Money Transfer. Their activities include operating well over 30,000 ATMs around the World.
A Market Capitalisation of around $3.9Billion brilliantly advertises the success of an enterprise founded by two financial services visionaries, one of whom, Mike Brown, remains at the helm today, serving as Chairman, CEO and President.
Learn more about this wonderful company here
ATMIA Europe is very proud to have Euronet Worldwide as a long-term member!
To see what our members love about ATMIA, we invite you to view our past membership videos on the ATMTube.
Contact Ron Delnevo, Executive Director Europe at firstname.lastname@example.org or +44 (0) 7973 210 154.
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