Editor’s Note: ChannelNet, which develops interactive digital technologies for community banks, has partnered with POPin Video Banking to offer interactive teller machines that feature video access to a live person at a physical bank location. Paula Tompkins is CEO and founder of ChannelNet. Jed Taylor was involved in the early development of video teller machines and joined POPin in 2016. Tompkins and Taylor spoke with BankBeat’s Justin Dullum about how these machines fit into the community banking model.
Q: What is required on the site of the ITM and what does the bank need to do to service video from afar?
Jed Taylor: ITMs are fully functioning ATMs with additional devices. The set-up and service is similar to what’s required for ATMs with the primary difference being location. It’s important that ITMs are deployed in a manner that enables good audio and video communication with the remote tellers. The bank needs to set-up a video call center to answer customer calls.
Q: ITMs are fairly new, but it’s not as if the technology hasn’t existed for a long time to make them possible. Why are they starting to break through now?
J.T.: It’s really a convergence of three factors. First the supporting technology is becoming affordable. Sure it was possible before but bandwidth and the components were expensive. Now it’s affordable for banks of all sizes. Second, consumers are becoming considerably more comfortable using video communication. Skype, Facetime, and [Google] Hangout are becoming common tools for all demographics, so the transition to using video for banking is less of a leap. Finally branch needs are changing and banks need to identify ways to reduce operating costs. ITMs allow banks to shrink branch footprints, reduce branch staff, and improve consumer convenience.
Q: Why might a bank implement the efficiency of an ATM while also committing to a certain employment level to man ITMs?
J.T.: This is a key misconception. ITMs should never be viewed as enhancing self-service capabilities and ITMs should not be used to reduce ATM traffic. The value and purpose of ITMs are to offload branch and drive-thru traffic. Clearly there are poor deployments that target ATM users but that’s the wrong approach. A few vendors actually sell ITMs as an ATM-plus option. It’s not! The best ITM deployments reduce branch teller traffic or provide branch-like capabilities for non-traditional branch settings or times.
Q: What’s an example of how an ITM is an improvement from the consumer’s perspective?
Paula Tompkins: Today’s consumers and business customers are time-starved. They don’t always have time to go meet with a specialist in the branch. This is especially important when they need advice or help on a complex transaction. That is why web- and mobile app-based ITM technology provides a great way to have that face-to-face meeting with a banking expert. It’s much easier and more convenient. Even contractual paperwork and documents can be signed as part of the video chat experience between the banker and the customer.
Q: Are there specific regulatory concerns about ITMs?
J.T.: They need to adhere to ATM regulations. ADA is another consideration that not all ITM vendors have properly considered.
Q: If a bank decides to go down the ITM path, where might it start in thinking about deployment?
J.T.: The easiest ITM deployments are new branch locations. Before a financial institution breaks ground on its next branch, it needs to compare the construction and operating costs of a traditional versus an ITM-enabled branch. I think bankers will find they can build a smaller branch, staff it with fewer people, and provide better service using ITMs. Then they can take it to the next level and see if they can replace subsequent branches with a mini-network of teller enabled ITM deployments such as drive-thru lanes in parking lots, vestibules, etc.
P.T.: Community banks are more trusted by their local customers. Specifically, small business owners tend to gravitate to community banks. Small business owners and high net worth customers typically have more complex transactions and needs and tend to lean more heavily on their community banker for a broad range of help and assistance.
Q: How do you see interactive tech like this evolving? Are phones next?
J.T.: POPin Banking is taking the concept of video banking to web and mobile phones and seeing excellent results. Customers are connecting to their bankers via mobile phones or online to secure loans, open new accounts, and apply for mortgages. Adoption of this mobile-based technology is accelerated over traditional ITMs.