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In a world of growing financial and payments choices, many have begun whisper a death knell for “traditional” methods such as the automated teller machine (ATM). However, studies and data continually show not only the continued proliferation of cash but a strong desire for a wide variety of convenience options, especially among the younger generations. Here are three reasons ATMs are and will continue to be a part of the future of banking.
Surcharge-free ATM access is the most common motivation for Millennials (18-35) when switching financial institutions. According to a recent study by research firm Phoenix Synergistics, Millennials rank ATMs above free accounts, life-changing events and better customer service when changing their account provider. This demographic is also the most likely to make a switch. 13% of millennials interviewed had switched financial institutions within the past two years – compared to 8% of Generation X and 6% of Baby Boomers.
Youth are “digital natives”. While previous generations grew up with bank branches, letters and slide rules, those up-and-coming barely know life without computers and the internet – if at all. This foundational experience gives them a high degree of familiarity and comfort with self-service – making remote account and cash access a preferred method in their everyday lives.
Bank where you work. According to a recent Rent.com survey of 1,000 U.S. millennials, just under half have moved away from their college or hometown. Many of these (44%) moved to a more urban area. Forty-three percent (43%) report having moved based on job opportunities. Another 44% report planning to move again within the year. Due to this transient tendency, it is no surprise that the younger generation bases the majority of their banking choices based where they work. Due to their small footprint and growing technology access, ATMs allow financial institutions to partner with employers and office buildings to provide the on-site account access Millennials crave.
Despite a growing reliance on mobile technology, younger Americans still place a great deal of preference on cash and convenience. This creates a unique position for the ATM to become the vanguard and, eventually, main channel for one-on-one interactions with current and potential account holders. As such, appropriate operation, placement and branding are not only becoming more essential for survival but a big part of the future of banking.