ARCA Financial Blog

Not only do cash recyclers allow branches to streamline their cash operations, but they also allow tellers to focus on engaging with customers.

Tellers Do Not Cross Sell Effectively Under Pressure

In a manual environment, tellers live under the constant fear of being out of balance. This pressure drives some unintended consequences. Tellers constantly “fiddle” with their cash drawers during the day, moving money back and forth from their top drawer to the second drawer, performing trial balance counts, strapping and counting money, just to maintain control of the accuracy and amount of cash in their drawers.

Tellers must perform every transaction perfectly and must do so quickly. Many tellers resist the additional pressure to cross sell, citing that they cannot afford to take their focus off of counting the cash.

Consequently, cross selling initiatives have failed partly because tellers wait until they finish counting the cash before they switch their focus to the customer. Once the customer has received their cash or cash deposit receipt, they are ready to leave and are unreceptive to a sales pitch from the teller. However, while the customer is waiting for the transaction to process, the teller has their complete attention, as long as he maintains control of their cash.

Timing is Everything During a Customer Transaction

The typical cash-handling portion of a transaction takes from 20 to 45 seconds. With cash recyclers doing the counting, this time in the middle of each transaction becomes valuable customer engagement time for the teller who is no longer burdened with the task of manually counting cash. The institution has bought back this critical “mid- transaction” moment while the customer is still engaged with the teller.

It is a more natural point from which to start a conversation about new products or for the teller to follow prompts from a CRM system for cross selling. The customer is more likely to listen and take interest in what the teller has to say as the cash recycler is doing the mundane, but critical task of counting cash.

Some Customers Don’t Come to the Branch Often, But When They Do…

Visits to the branch are declining in certain demographic groups, but it remains true that over 80% of all new accounts are still opened in a local branch. So when these customers do show up in a branch for some sort of non-typical cash transaction it becomes even more important to engage with them in a meaningful way. If the teller misses this chance to connect with this infrequent visitor, it might be a year or more before they get another chance.

Making the Case for Cash Automation

Why TCRs are one executive’s go-to solution

Craig Roper, senior vice president and chief deposit officer at Bank of Utah, is a two-decade banking veteran. He’s spent much of his career cracking the challenges of cash flow — finding ways to keep customers satisfied, keep branches safe and keep money moving smoothly. One of his go-to solutions? Teller cash recyclers.

Teller cash recyclers, or TCRs, are secure, under-counter vaults that accept, authenticate, store and dispense banknotes. By streamlining cash-in and cash-out functions, they free tellers to focus on cross-selling and customer service instead of counting. They also increase efficiency, reduce cash inventory, and improve branch security.

Roper observed the benefits of cash automation firsthand while working for regional and national banks. As part of an elite branch-improvement taskforce, Roper was deployed to troubled areas around the country. He and his team would observe in-branch processes for a week or more, searching out the inefficiencies that were slowing transaction times. Based on their findings, the team would build a plan of action for the region, then help local employees implement it. TCRs were often critical to success.

When Roper joined Bank of Utah, he was excited to introduce cash automation to the 13-branch community bank. He began in Ogden with the CM18, an advanced TCR from ARCA, a company that specializes in automation solutions for financial institutions.

Since installation in summer 2011, results and reactions in Ogden have been positive. Tellers are processing more transactions in a shorter time and customer wait times have decreased significantly. The branch no longer needs to dedicate a staff member to cash tending.

Roper reports that Ogden’s branch manager appreciates what the CM 18 has done for her bank. Tellers are less occupied with cash counting, she said, and she no longer worries about a line in the lobby.

Roper said the tellers have also come to appreciate the technology and adjusted quickly to the CM 18, thanks in part to its ergonomic design, intuitive interface, large banknote capacity and small footprint. While the tellers had questions at first, they were fully on-boarded in about three weeks. “They told me this was the best tool they’d ever had,” said Roper.

Ogden is not an anomaly, according to Roper. He believes TCRs will work for branches of all sizes and offered some advice for colleagues considering the move to automation.

• Know the patterns of your branches. What are the busiest periods during the day — and what’s causing the bottleneck? In Roper’s experience, banks are often bogged down by slow cash movement at peak times, and that’s a problem that can be solved through cash automation.
• Calculate the potential outcomes. Cash recycling can speed the average transaction 40%. How could that efficiency impact your bank? Would it allow you to reduce FTE? Determine how much time and money you stand to save, then decide whether TCRs make sense for you.
• Plan for the impact. Reducing teller FTE doesn’t have to mean eliminating jobs. Roper believes that many banks don’t focus enough attention on out-of-branch channels, like online services. If you’re able to reduce in-branch FTE with TCRs, you could consider moving some employees to online customer service work.
• Help tellers, branch managers and executives prepare for the change. While TCRs like the CM18 are intuitive and simple to use, tellers and other staff will need a few weeks to master the new system. Give your team plenty of training and time to adjust. Remember, you’re investing in future success. Most teams are working faster than ever within a few weeks.

Roper also urges banks to choose carefully when it comes to automation solution providers. For his bank, Roper chose ARCA because it works closely with clients to create and implement the features and functionality they need for their financial institutions.

“Having the manufacturer involved in the process is incredibly beneficial,” said Roper. “I’m at a community bank because I like the way we can personalize our approach to every customer. ARCA is the same kind of company. We get just what we need. The responsiveness has been remarkable.”

Abbie Kiefer is a freelance writer. She lives and works in Raleigh, North Carolina and may be contacted at
abbie@abbiekiefer.com

To learn more about the CM 18, visit www.arcatechsystems.com/financial. For more information on Bank of Utah, visit www.bankofutah.com.

The inefficient manual practices of maintaining drawer limits, vault buys and sells and dual control define branch procedures, staffing models and the cost of controlling cash. Drawer limits require tellers to make trips to and from the vault during their shift to adjust the levels of cash they have exposed in their drawer. Vault buy and sell transactions consume valuable teller time with manual counting and verifying cash as well as the time the head teller spends maintaining dual control, security and accountability. Each vault buy or sell transaction takes at least five minutes of the tellers time and a couple minutes of the head tellers time, compounded by multiple tellers making trips to and from the vault multiple times a day.

A cash recycler solves this problem by distributing the vault to teller workstations to dispense and deposit cash as needed with every transaction. This eliminates the need for teller drawers, trips to and from the vault and the dual control assistance from the head teller. Incoming cash from customers is deposited into the recycler and is ready to be dispensed back out with the next cash-out transaction. Furthermore, the the time it takes to generate start funds and balance teller drawers at the beginning and end of the day is eliminated. As soon as the teller logs onto the teller application and the recycler, he or she is ready to go. Because the recycler keeps an audit trail of all it’s transactions, it is always in balance and end of day procedures take only a couple of minutes.

Generally branches reduce six or more hours of teller and head teller time per
day after the implementation of recyclers. Because the tellers are more productive and no longer have to manually handle and count cash they have more time to engage customers, promoting, referring and cross-selling other products. Physical branches are the most expensive customer delivery channel, but they are also the channel where the highest-value transactions take place. The more time is spent engaging with customers in the branch, the more invested customers will become in the relationship. This increase in customer-facing time with every transactions can easily double cross-selling results.

Finally, the cost of maintaining and securing large cash inventories in the branch is high. Typically branches keep a lot of excess cash on hand in order to handle their customer transactions, especially in anticipation for peak operating times. Moreover, there is usually at least one armored cash delivery trip every week to deliver cash or to ship excess. By using recyclers, branches can maintain a real-time view of their cash levels where by all the cash in the branch is available for customer transactions. This means that cash deliveries can be more cost-effectively scheduled and the cash inventory of the branch can decrease by up to 30%. Recyclers can track every movement of cash in, out and within the branch. By maintaining this real time vantage of the branch's cash position cash forecasting and ordering is more accurate and auditing is simplified at every level from branch to enterprise.

This is just the tip of the iceberg. Under the surface the operational benefits, cost reductions, and increased profitability of recyclers go on and on. If you would like to see a detailed analysis of automating the control of cash in your branches, contact us.

At ARCA, we see beyond the hardware and software to the real problems that we help people solve. Cash automation is all we do and we would love to to talk to you about it.

Are Your Branches Still Using Cash Drawers?

Controlling the cash in a branch costs plenty. The processes of vault-buys and sells, dual control, end of day balancing and counting cash are not efficient and do not add any value to the customer, but are required to keep the cash in the branch secure. The staff of the branch spends almost the entirety of their time counting cash, re-counting cash, buying from and selling to the vault, more than often in dual control. This forces banks to staff their branches to a level appropriate to control the cash, rather than to simply handle the transactional volumes and provide an appropriate level of customer service. The control of cash even determines the type of people banks hire as tellers. Tellers are hired and retained based on how quickly and accurately they can count cash, rather than on how well they can engage customers.

But what is the branch channel really for?

In an increasingly competitive and regulated market, the branch channel offers banks direct face to face contact with their customers to provide the kind of customer service and product information that can make them customers for life. When the problem of controlling cash is solved, a whole universe of possibilities and options suddenly appear to the bank.

Tellers can spend their time engaging customers rather than counting cash and the entire feeling of the branch can change very quickly. The easiest way to control the cash in a branch is through the use of a Teller Cash Recycler, which can automatically count, sort, validate and denominate cash, then store it in a secure vault until it is required to be re-dispensed. Dual control activities such as vault buys and sells are virtually eliminated, as the vault is now distributed to the point of use.

Branches should be a vital and profitable channel; automating the control of cash makes it possible.

Control your Cash. Connect with your Customers.

Visit us at the BAI Retail Delivery Show (Booth 313E in the Self Service Demo Center) to see the next generation of cash recycling and learn how your tellers can do so much more than count and control cash.

Jack Malinowski, chief technology officer for Benchmark Technology, says the future of banking is focusing on teller-cash recyclers and teller-cash dispensers.

Click Video thumbnail below to watch.

Cash recyclers, dispensers are focus at teller line...