Introduction
One of the fastest technological innovations that will soon replace ATMs' work is the Cash Recycling Machine. The Cash Recycling Machine can be defined as a self-service terminal that enables customers to make cash deposits and withdrawals.
What is a Cash Recycling Machine?
Now, just imagine that you have some money in your wallet. This is a finite amount of money. Whenever you wish to make any payment, you will withdraw the money from your wallet. This means that the cash in your wallet is getting less with every withdrawal.
Now, to refill the cash into your wallet again, you will visit an ATM. However, imagine if the ATM has run out of money for some reason, you will now have to wait to add money to your wallet, and consequently, the payments get delayed.
Similarly, if you hold a large sum of money in your wallet, you will always try to deposit it in a bank safely. However, just imagine that if the bank has a holiday or it is after working hours, you will have no alternative but to hold that extra amount of money until the next time you visit the bank. Keeping an enormous amount of money can be potentially risky. At some point in time, we wish to have a way to have cash handy when required and similarly deposit the excessive money when not needed without standing in the long queues at the bank. The Cash Recycling Machine plays this specific role.
How does a Cash Recycle Machine Work?
When anybody has to deposit cash in a bank, they have to go to their respective bank branch during the bank hours, and sometimes need to wait in long queues, thus affecting the usual routine. This usually becomes quite a source of inconvenience in areas that operate with only one bank within miles, and an ordinary banking transaction could take quite a lot of time.
A Cash Recycling Machine (CRM) is usually placed at a location such as a market, shopping mall, or residential area. In a Cash Recycling Machine, banknotes are inserted in the cash slot. These notes then pass through a bill validator to confirm the authenticity of the banknotes.
Invalid or counterfeit banknotes are then kept aside. The actual amount of cash deposited and the denominations are recorded and at once credited in the bank account of the depositor or the transfer account. This cash amount is credited in real-time, and customers will receive an acknowledgment slip confirming your transaction.
This cash is then stored separately in modules as per the denominations for dispensing in future transactions. So, it accurately meets the true definition of recycling as the cash deposited into a Cash recycling machine is the same cash dispensed from it.
Benefits of a cash recycling machine
A Cash Recycling Machine provides a number of benefits such as:
No error & multi-functional
The manual form of cash handling is subjected to errors which the automated CRM eliminates. The automation facilitates a smooth flow of operation without any manual glitch.
One can also use these Cash Recycling machines for cash withdrawal-like any other ATM. Also, a CRM can do all other tasks that an ATM does, such as changing the PIN, checking balance, transaction statement, checkbook request, etc., and is almost like a standalone mini-bank in a way.
These days, more and more banks are opting for Cash Recycling machines to substitute their traditional ATMs and while deploying new ATMs for their benefits of convenience, cost, and operational efficiency and better utilize their employees' time.
Paving way for an automated future
Imagine the kind of difference that a Cash Recycling Machine will make in a small remote village, an industrial complex or a local shopping market; the 24 X 7 availability feature is beneficial for the shopkeeper or small business owner who carries transactions primarily in cash. They will be able to deposit some money without impacting their business after business hours and withdraw cash as per the requirement whenever they need it rather than constantly worrying about keeping excess cash in hand in their offices, shops, or homes.
Creating a difference in the banking ecosystem
A CRM also performs another critical role in the larger cash ecosystem. An ATM needs to be replenished promptly, or it will soon run out of money. While this cash replenishment cycle is usually between 2 to 4 days depending on the type of locality the ATM is situated in, the replenishment cycle for a Cash Recycling Machine is longer, as the constant deposit and withdrawal of cash mean that the chances of a CRM running out of money are relatively more minor if the deposit and withdrawal requirement of that particular area is more or less similar.
This means that the CRM is operationally efficient and cost-efficient as it reduces the number of times that a Cash-In-Transit (CIT) agency needs to visit the CRM for cash replenishments.
Impact of the Pandemic on cash recycler machine
The Covid-19 pandemic has had quite an interesting impact on the cash trends, too. While the number of cash transactions at the ATM fell by almost around 60 percent in some of the countries, withdrawal amounts have increased tremendously. And even now, as the pandemic continues to dip and spike, so do the cash banking patterns, thereby increasing the complexity and costs of managing cash and ensuring that customers have access to it at all times.
This is where the role of cash recycling machines really comes into play, enabling deposited cash to be reused for cash withdrawals once it's undergone internal bill validation to ensure that no counterfeits or unfit notes re-enter the circulation.
That's why many financial institutions in different parts of the world are now switching towards ATMs enabled with cash recycling capabilities, easing the costs associated with their branch management. This is also why cash recycling is expected to see significant growth in the coming years.
Conclusion
It's, therefore, crystal clear that these smart ATM machines or cash recycling machines offer Financial Institutions a lot of potential benefits from significantly reduced costs and better security to improved branch efficiency and cash optimization. And with the greater adoption around the world, FIs will need the most competitive solution that combines cash management software and cash recycling ATMs to rake in the wins and keep them coming.