By John Meyer
Vice President, Integrated Solutions
Harland Financial Solutions
800-989-9009 x6625
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(May 08)
The act of putting pen to paper encourages pause for thought, this in turn makes us think more deeply about life, which helps us regain our equilibrium.
-Norbet Platt, President of Montblanc
While writing with pen and paper is an art form that gives pause to great minds, does it give pause to your customer service and cause your customers to ponder why they should continue banking with your institution?
This paper looks at five key trends emerging in the automated teller world that should give pause for thought to any institution still using manual pen and paper procedures at the teller window or Sharp Teller Machine solutions.
Customer Satisfaction
With over ten financial relationships per household in the United States today, there is no question that consumers have choices regarding where to bank, insure, and invest. If you ask bankers how they compete in this environment, almost all will utter the word “convenience.” So how does teller automation add to customer convenience?
Convenience starts with the teller efficiently managing the customer line so that no one waits excessively. The first element in convenience is eliminating the need to leave the customer while performing a transaction. In manual or Sharp Machine environments, tellers leave customers to check balances, price bonds, type up cashier's checks, seek supervisor approvals, and retrieve signature cards. The second element of convenience, which will be discussed later, is recognizing valuable customers and applying consistent policies for holds, fees, and product inquiries.
Automated teller solutions eliminate the need to go to a terminal to look up balances on high dollar deposits since the balances are returned with each transaction. In manual environments, there is usually a queue at these devices while multiple tellers attempt to run lookups, furthering the delay the customer incurs.
Cashier's checks, money orders, and other official checks can be printed right at the teller window with an automated teller system. Using impact printers at the teller window, three part forms can be sent through the device for a record. Automated teller software also interfaces to laser check printing software which eliminates the need for keeping stock inventory in the branches.
One of the most time consuming activities in manual environments is pricing and cashing out bonds. Treasury bonds can be valued electronically in just a few keystrokes at the teller window with automated teller software.
An automated teller system also allows tellers to communicate directly with their supervisors and receive remote overrides without having the customer feel uncomfortable that something unique just occurred with his or her transaction.
Likewise, signature cards can be viewed electronically and digitized photos can be retrieved automatically with automated teller software.
Identifying the customer via a signature card or digitized photo leads to the next step in improving customer satisfaction. Automated teller software can help the community bank differentiate itself by knowing its customer better than any other institution. Automated teller solutions enable tellers to view special notes outside of the core alert system that indicate when a customer has a birthday, anniversary, or other significant life event occurring that warrants mention. These special notices can even be printed right on the customer's receipt for more personalized service.
Receipts offer another compelling customer convenience for automating the teller window. Grocery store-style receipts that list the time and date stamps of the transaction, along with promotional marketing and Regulation CC hold notices to eliminate conflict surrounding deposit availability for customers can be included.
As mentioned before, customer satisfaction also means having a consistent experience with fees. Automated teller software ensures that tellers apply fees consistently across all customers and can note the reasons for fee waivers for special customers.
Finally, the right branch automation helps clients gain a consistent experience with the financial institution by ensuring that the branch team captures sales referrals and service requests at the time of the transaction. Nothing is more frustrating to a client than to be told to call a 1-800 number to perform a personal request by a front line employee. Customers come to the branch to perform these high-touch transactions for a reason and automated teller software ensures that the branch team can fulfill these requests.
Reduced Fraud and Other Losses
Fraud losses hurt the bottom line. Automated teller software reduces fraud by retrieving host alerts, balances, signatures, digitized photos and by placing holds, stops, and memo-posts to an account. Automated teller software cuts down on internal fraud by looking for suspicious teller activity. It also eliminates many over and short losses, time intensive analysis transactions, and balancing errors.
As discussed before, manual or Sharp Machine environments require a teller to leave a customer to use a terminal to look up customer balances. While this impacts the wait time and the customer experience, it also impacts the fraud that an institution may experience. Many times, host alerts for accounts are missed in the terminal world. In an automated teller environment, these host alerts require a supervisor override, causing the tellers to pause and take note of the information displayed.
While digitized photo and signature retrievals enable tellers to better know the customers, it also can stop check counterfeiters by alerting a teller that the person in front of him or her is not the account holder or a signer on the account.
Placing holds and stops through the automated teller software saves the teller significant time, while saving the bank significant money. The customer gets the compliant notices and the institution gets the additional float and other safeguards.
Looking for suspicious teller activity includes looking for those transactions in which certain tellers are getting overrides from the same supervisors or where tellers are getting an override message and cancelling the transaction. This activity indicates that someone is potentially in alliance with another bank employee to defraud or that a teller is testing the limits.
An automated teller solution reduces over and short losses by requiring newer tellers or less experienced tellers to use cash out and cash in assists that recommend a bill mix or require a bill mix distribution or count. Using cash assistance has been estimated to save nearly $1,000 per teller, per year at one automated bank.
Time intensive analysis transactions for business accounts often cost a bank money as the forms for strap and coin exchanges rarely make it to the back room for monthly statement assessments. Automated teller software collects this information at the time of the transaction and can send this over to the backroom either via an electronic or paper report.
Balancing also becomes much simpler with the elimination of a lot of paper tape in the automated world. Tellers can use journal scans and reports to find out-of-balance situations and eliminate proof corrections before they happen. Trial balances throughout the day with records of teller names and teller numbers also eliminate much of the searching that occurs at the end of the night in the branch at settlement time.
BSA Compliance
BSA. AML. OFAC. USA PATRIOT Act. FFIEC. These acronyms drive fear and dread into many compliance officers' hearts as they try to understand how they will meet the monitoring and reporting requirements for the next exam.
Teller automation helps these compliance officers by enabling the proper data collection at the time of the transaction for monitoring and reporting of CTRs, SARs, and Monetary Instrument Logs.
At the teller window, automation software will force a teller to collect the name and tax identification number of the person conducting cash transactions. If the customer's or transaction conductor's data has been entered into the teller software before, the teller picks the name from a list. In manual systems these data elements are not collected at the time of the transaction when cash exceeds the reporting thresholds. The compliance team has to assume that the account holder conducted the transaction, which is not always true. Manual systems are fraught with errors in BSA compliance.
Teller automation also enables a bank to look for structuring by reporting transactions that have surpassed a cash threshold but do not exceed the $10,000 IRS reporting requirement. Sorting these transactions by conductor and account holder gives the bank compliance team a new way to view activity required for SARs.
For those transactions that do exceed $10,000, an automated teller solution will create the FinCEN Form 104 with the appropriate information, enable compliance team members to track changes, and allow bank employees to file the forms electronically or keep track of paper submissions.
It's estimated that 60 percent of money laundering occurs at the teller window. Teller automation allows easy integration to other solutions, such as BAM from Banker's Toolbox, for complete cash consolidation across all channels, including the teller window.
Last, auditors are increasingly asking for electronic Monetary Instrument Logs showing that the institution is tracking all amounts over $3,000 and that the payee and the account holder have been verified against OFAC when a cashier's check, money order, or other official item is sold. Teller automation ensures that none of these critical pieces gets overlooked by the tellers performing the transactions.
Better Team Management
It's simple: happy and efficient tellers make happy customers. With nearly 40 percent turnover in these positions annually, it has traditionally been difficult to keep these valuable team members trained and rewarded for better retention.
The 40 percent turnover means constant training. In over two dozen interviews, teller training can take up to two weeks before that individual is capable of being proficient with a teller solution. Teller automation solutions that guide a user to the next step in a transaction have reduced that training time 80 percent - from ten days to two days, which results in significant time savings annually for branch managers and teller supervisors.
Equally demanding for these branch managers and teller supervisors is rewarding the best tellers for a job well done. Teller automation provides detailed reports of balancing histories, overs and shorts, fee collection, sales and service referrals, and transaction volumes for performance measurement and skill development.
Team management also extends to monitoring cash on hand so that tellers can conduct buys and sells at the right time in order to minimize risk and improve customer service. Teller automation also helps the management team understand peak traffic times to schedule the right amount of help in the branches.
Ultimately, team management means bringing experienced tellers into the organization and giving them the best-of-breed tools to do their jobs. Many non-automated banks have had a hard time recruiting for this vital position as tellers experienced in automated environments are expected to regress to manual or Sharp Machine-based processes.
Future Flexibility
Technology changes constantly. In today's automated world, banks are leveraging currency counters, cash recyclers, automated currency dispensers, and identification devices to ensure a speedy and accurate customer experience. With remote deposit capture as one of the fastest growing business and branch services in the industry, banks are looking to leverage this technology further.
Automated teller systems integrate with the other automation elements of cash dispensers, recyclers, and counters by seamlessly integrating these technologies into the workflow of the teller. Cash-out through a dispenser is a simple process with teller automation. Likewise, using a recycler or counter in the cash-in process can pre-populate the appropriate fields in the automated teller solution.
Branch capture on the back counter is gaining momentum today, but as businesses start capturing their own work, the cost justification of moving capture to the teller window makes a lot more sense. Almost 80 percent of transactions at the teller window today are less than ten items which makes these ideal candidates for image capture at the point of presentment. An automated teller solution can integrate with these smaller scanners and eliminate all paper including cash-ins, cash-outs, GLs, and other tickets.
The reasons for automating the teller line extend to all facets of banking, including the customer, fraud, compliance, teller performance, and the future of technology. Non-automated banks are wise to spend the time and energy it takes to best understand how investing in this critical technology can improve their business performance and customer satisfaction.
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