cash management of banks

8/13/2019 cash management of banks

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INTRODUCTION

Since their introduction in the 1960s ATMs have rapidly grown to become one of thekey connections between financial institutions and their customers. While ATMscan, and do, provide a wide range of services, their original mission to dispensecash is still vitally important. Network failures, where customers are preventedfrom accessing their accounts are extremely visible and, if they happen regularlythey can cause reputational damage. BPCs ATM solution provides you with 24x7visibility of the entire network, pinpointing areas of concern before they turn intobrand problems.

Supporting your Business

In addition to providing a wide range of options to enable the rapid tailoring ofservices, BPCs ATM management solution enables you to target specificcustomers, or groups of customers with messages to support your marketingcampaigns. The solution also provides sophisticated reporting to help you optimize

the cash held at each ATMmatching cash needs with customers demands. Thissolution can result in considerable operational savings as ATMs typically contain40% more cash than is actually needed and cash handling costs represent 35 to60% of the cost of running a typical ATM.


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Parties involved

RBI (currency chest)

Corporate branch in the city

Retail branches Delivery channel coordinators

Outsourcing agents (bricks arya, CMS

securities, writer safeguard) VISA network (overseas)


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Key elements involved

Cash flow

Information flow

IT Infrastructure (star flow, switch flow-server)

Database

Cash memory during network failure

Lead time cash replenishment

Payments and receipts (demand and supplysynchronized)

Different denominations

Geographical locations

Status of accounts


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Visa network

Key factors to be ensured for efficient

functioning Vendors in the supply chain

Actual time taken to replenish cash

Physical replenishmentsBreak down functioning

20 min- info of breakdown

1 hour-Informing outsourcing agent


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Time series and judgment forecasting

Time series

Monthly


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Cash demand forecasting

Defining the market

Dividing the industry into its main

components

Forecasting the drivers of demand and project

the likely to change

Conducting sensitivity analysis andunderstand most critical aspects


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Selecting the forecasting methods

The contest of the forecast

Relevance and availability of historical data

Time period to be forecasted Degree of accuracy

Cost benefit or value of the forecast

Time available to analyse


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Factors which contribute when

techniques are used:

There is no stock out situation in any branches

nor ATMs

There is not much idle cash available due to

high opportunity cost

Delivery cost to the ATMs is to be minimized

Lead time is to be minimized Architecture of supply chain


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Introduces in 1987 by hsbc in mumbai

2009,40000 atms in India


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Managing ATMs involves a wide range of services thatare provided to banks by various specialist companiesto keep customers satisfied. It is not just thedeployment of the ATMs for the respective bank; there

exist innumerable other services like installation ofsupport devices like generators and UPSs, theirmaintenance, installation and configuration ofnetworks and switches, VSAT devices for ATM-Bank-ATM or other types of communications, establishing

and managing data centers, cash forecasting,reconciliation, transactions processing, managedservices, and much more.


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1. Transaction process: This includes management of transactions with due authentication. This involvesmanaging the chain of communication 24x7 through switches from an ATM to the bank and its core services tocross-check with the account details of the person using the machine, verifying and authenticating the identity,and allowing the customer with go ahead signals back to the ATM.

2. Managed services: As we know, there are several other entities involved apart from the ATM in the given space:AC, the generator, the UPS, the electronic camera, furnitures and fixtures, lighting, etc. Monitoring of all theseentities through different vendors comes under managed services. A proper back office is required, along withother crucial services under this category, like managing technical faults, troubleshooting, and providing the bankwith information like location-wise cash forecasting for ATMs, and accounting and reconciliation.

3. Field services:These include cash-in-transit, vaulting, providing physical security, site maintenance with firstand second level of servicing, and housekeeping activities. First-level maintenance (FLM) includes resolving lightproblem areas pertaining to equipment like currency jam, receipt jam in the machine, ACs, lighting. Second-levelmaintenance (SLM) goes into more serious technical issues with the ATM blockage, repair work of UPS, machinefailure, and repair of VSAT devices.

4. Asset-related services:Banks prefer outsourcing these services to companies that offer packages for managingtheir ATMs and providing end-to-end solutions. There are two motives behind this. First, the banks canconcentrate on their core functions of banking services rather managing IT infrastructure and troubleshooting.Second, outsourcing assets like an ATM, furniture and fixtures, ACs, generators, etc, is a more economic optionthan owning the required assets. Service providers further delegate the work to other respective vendors. For

example, a service-providing agency delegates the order of ACs to an AC manufacturer/vendor; forelectronic/physical security, it is delegated to security providers; and so on.


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Manufacturers/ManagersCompany: NCR CorporationServices:Manufactures and installs ATMs, manages the ATMs, etc.India headquarters:MumbaiATM manufacturing facilities in India:Pudducherry, Bangalore

Company:Diebold Systems

Services:Manufactures and installs ATMs, manages the ATMs,provides with physical/electronic security, etc.India headquarters:MumbaiATM manufacturing facility in India:Goa

Company:Wincor NixdorfServices:Manufactures and installs ATMs, manages ATMs etc.

India headquarters:Mumbai


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http://www.writercorporation.com/services/c

ash_management.htm

Atm CMS Department

Atm co ordinators

NCL
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5 reasons y banks need to optimise

cash management

With growing pressures on bottom lines,

financial services organizations are

increasingly looking to reduce operating costs.

Many banks are eyeing their sprawling ATMnetworks for opportunities to operate more

efficiently and cut expenses.

Here are 5 reasons why your institution shouldoptimize ATM cash management now:


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1. Cash is king.Many banks maintain as much as

40 percent more cash than necessary at their

ATMs. That ties up cash that institutions could

put to better use elsewhere. Advanced ATMmanagement systems can help you accurately

forecast daily cash demand and reduce

excessive cash levels at your ATM locations


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2. More ATMs mean higher operating

costs.Today, there are an estimated 2.3 million

ATMs worldwide. Experts expect the global

installed base of ATMs to jump to 3.2 millionterminals by 2016. Banks that take the initiative

now can rein in ATM operating costs before cash

management problems get any more challenging.


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3. Lower costs.Cash-related costs make up

35-60 percent of the overall costs of running

ATMs. ATM management tools like BPC's

SmartATM use sophisticated mathematicalalgorithms to analyze all ATM transactions and

pinpoint demand patterns to help you ensure

the most efficient use of cash across yournetwork.


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4. Improve ATM servicing. It's costly and time-

consuming to service your ATM network.

Automated ATM demand forecasting and

replenishment planning tools can help yousave personnel time, reduce servicing costs

and ensure you have the right cash levels at

the right locations.


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5. Customer service is a top priority.In today's turbulent economy, moreconsumers are turning to cash for purchases. That makes it even moreimportant to make sure you have sufficient cash levels across your ATMnetwork. Automated ATM management solutions help your financialservices organization reduce out of cash incidences while maintainingservice quality and availability for your customers.

As the size and complexity of ATM networks increases, it's critical forbanks and other financial services organizations to continue to invest inthis important channel as an important customer service tool and touchpoint. As they do so, institutions need to be sure they are optimizing ATMcash flows to improve return on cash assets, reduce operating costs anddeliver high-quality service to their customers.

Richard Phillimore is executive vice president at BPC Group. Richard hasmore than 45 years of experience in the global financial services industry,including senior positions with NatWest Bank, MasterCard Worldwide andFidelity National Information Services.


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BPC products

Total ATM Management

ATMs have evolved dramatically since their introduction in the 1960s. Today they are complex, fully interactivecustomer touchpoints that offer a wide range of services, dispensing cash, concert tickets, pre-paid cards andfeaturing state-of-the-art devices such as scanners and streaming video.

One thing that has not changed, is the importance of keeping your ATM network operational 24x7. SmartATM isdesigned to provide you with all the tools you need to automate, service and monitor your ATM network.SmartATM helps ensure that your most visible channel keeps running 24x7, delivering the services your customersneed at a cost that meets your business goals.

With our cash management solution you can monitor cash flows, pinpoint patterns and optimize the levels of cash

held at each ATM, based on accurate demand forecasting. In addition to ensuring that out-of-cash conditions areavoided, this solution can dramatically reduce the cost of managing your ATM network.

Full range of services

In addition to supporting all the standard ATM transaction typessuch as cash withdrawals, balance inquiries, PINchange, mini statements, cash deposits and funds transferSmartATM also supports a wide range of value-addedservicesincluding mobile top-up, bill payment and remittances.

With SmartATM you can extend your marketing campaigns to your ATM network, remotely configuring menus andscreens to ensure that the marketing messages reach the target customers. And with SmartATMsflexibility youcan tailor the message to each individual customer.

SmartATM also provides facilities to integrate your call center operators into your ATM network ensuring thatcustomers can speak to an operator simply by picking up the phone or touching a button on the ATM. For addedconvenience two-way video is supported.

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cash management of banks