Cash management element of Diebold Nixdorf AllConnect Services helps to transform operations for bank’s ATM network
Germany’s Degussa Bank is outsourcing the management of the cash supply chain for its 220 automated teller machines (ATMs) to Diebold Nixdorf (NYSE: DBD), a world leader in enabling connected commerce for millions of consumers each day. As part of Diebold Nixdorf AllConnect ServicesSM, the offering will provide end-to-end cash management that covers everything from the provisioning and operation of the ATMs, to cash supply and implementation of banking requirements such as account reconciliation.
By shifting its day-to-day, in-house ATM cash management and operations to Diebold Nixdorf, the bank is able to reduce the total cost of ownership of its fleet and free its resources to focus on driving innovation and better serving its customers. Diebold Nixdorf is partnering with the German licensed bank Reisebank, which is assuming the responsibility for cash and asset management for Degussa.
Providing customers with access to cash continues to be an important service for Degussa Bank; however, it is more efficient and less expensive if it is managed by a specialized provider. As cash circulation rates increase, the cash cycle becomes more complex for financial institutions to manage. On average, cash management for ATMs accounts for 48 percent of ATM network operating costs globally—and an estimated € 1.3 – 2.6 billion per year in Europe alone.1
“When we considered how to handle the operation of our ATMs in future, we analyzed various business models and found Diebold Nixdorf’s cash-as-a-service offer to be compelling,” explained Uwe Hasse, who as service provider manager at Degussa Bank is responsible for managing the IT partners of the bank. “A single source for all our cash supply services means we benefit in several ways: Fewer funds will be tied up when our ATM network is renewed, we will need fewer resources to meet legal requirements and all the service providers involved will be controlled centrally. As a result, the management team can concentrate more intently on issues related to the digital transformation,” Hasse adds.
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By outsourcing the cash supply process to a specialized company, Degussa Bank is following a trend that many Scandinavian banks, in particular, are already implementing. In 2017, a number of financial institutions and data centers in Sweden and Denmark ordered extensive managed services from Diebold Nixdorf with the aim of having their ATM networks operated by the company. The global ‘as-a-service’ market is expected to grow at a CAGR of 38 percent by 2020.2
“More financial institutions worldwide are recognizing the advantages of ‘as-a-service’ business models compared to managing these types of complexities in-house,” said Olaf Heyden, senior vice president, services at Diebold Nixdorf. “They gain greater financial flexibility and speed, benefit from our decades of experience and high economies of scale, and can concentrate fully on their customers. We are excited to partner with Degussa to optimize and transform their ATM operations.”