How does an ITM work? Pros and Cons of Interactive Teller Machines

Our world has changed a lot in the last few years. Social media, iPhones, COVID, and an “I want it now” generation have made us shift from the normal transactional model to a FAST model. 

People want to drive up and get what they need right from their car without standing in line. Fast and convenient without ever stepping foot in a branch. 

So what is an ITM or Interactive teller machine?

Many have called it a “branch in a box” that operates just like an ATM, but with a twist. With integrated teller, people are able to interact with a teller while at the ITM to do a plethora of different transactions (or Interactions) as if they were in a branch. 

Hyosung ITMs also have the cash recycling innovation which allows you to really let the ITM be more autonomous. This means fewer cash fills and fewer human interventions with the unit. Many people are placing these units in stand-alone locations allowing staff to be repurposed and refocused from just doing transactions to interacting more with customers/members. 

What can customers/members expect to be able to do at the ITM?

ITMs have a live person on the other side of the screen, so by using electronic signatures and ID verification they can perform pretty much any service needed, including:

  • Giving cash withdrawals

  • Accepting cash deposits and checks

  • Paying down loans

  • Bill payments

  • Opening new checking and savings accounts

  • Transfers

  • Getting new debit or credit cards

  • Facilitating cash advances

  • Offering financial advice

  • All business account operations

  • Brokerage and equity account transfers and withdrawals

  • Money orders and bank checks

Pros of buying an ITM

ITMs can help you reduce costs by requiring fewer people to manage more customers. 

For example:

Five Star, a $500 million credit union with about 50,000 members in Georgia and Alabama, was able to move about 75% of branch transactions to a drive-thru using the ITM and after opening three new ITM branches in early 2019, at least two of those branches are among the top five branches in the entire company. The credit union was able to save $240,000 per year in labor cost savings.

Considering ITMs typically run for a couple hundred thousand dollars, Five Star could have made that money back within a few years of savings.

ITMs have lower operating costs

a teller costs around $4.05 for the average transaction and ITMs are about $2.40. For comparison, a typical ATM transaction is around $1.25 for a community bank ($0.7 for a national bank) while a mobile transaction is around $0.43 (sub-$0.20 at a national bank). While understanding direct cost savings is important, the real economics come in the form of a branch replacement.

The downside is that ITMs require a big initial investment. 

. Where your basic ATM is approximately $35k to $65k per machine, the ITM is an average price of $85k. Combined with the software integration, which runs around $200k, with staff time and training running another $150k.

The great thing about these units on the flip side is the ability to do the software integration in the future. You can buy the unit and use it as an ATM until you decide to make the leap and invest in the software to get the full capabilities out of your ITM. 

This is a big investment and you need to be sure of why you want to implement these units and have a specific strategy to get the most out of them. 

If you have any questions about how these units may be able to help future-proof your institution with ITM machines. 

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