Bridging the Gap Between ATM Myth and Reality

Automated teller machines (ATM) have not lived up to the original expectations of bankers and observers. Based on extensive research, the myths concerning ATMs include: 1. The ATM will reduce transaction processing costs. 2. The ATM will displace checks, thus reducing volume. 3. The ATM will mean fe...

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Bibliographic Details
Published in:Journal of retail banking services : JRBS 1990-01, Vol.12 (4), p.37
Main Authors: Haynes, Ray M, Brown, Stephen W, Finch, Paul W
Format: Article
Language:English
Subjects:
ATM
Automated teller machines
Bank marketing
Effectiveness
Financial institutions
Financial services
Predictions
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Summary:Automated teller machines (ATM) have not lived up to the original expectations of bankers and observers. Based on extensive research, the myths concerning ATMs include: 1. The ATM will reduce transaction processing costs. 2. The ATM will displace checks, thus reducing volume. 3. The ATM will mean fewer branches are needed. 4. The ATM will replace branch tellers. 5. The ATM will cause account balances to increase. 6. ATM usage will continue to grow. 7. An ATM service charge will generate fee income. 8. Customer demographics are key in ATM usage. 9. ATMs provide competitive advantage. 10. The ATM user is more likely to use other electronic banking services. Financial institutions must consider how to bridge the gap between the myths and reality of ATMs within their own competitive and operational environments. Banks need to spend more time encouraging ATM usage. Institutions should consider a 2-stage program that focuses initially on attracting nonusers with cost incentives and is followed by an emphasis on customer retention.
ISSN:0195-2064