Opportunities for cost reduction of Macedonian banks by introducing solutions for intelligent cash management in the field of ATM operations
Opportunities for cost reduction of Macedonian banks by introducing solutions for intelligent cash management in the field of ATM operations

Summary/Abstract: Payment card business in Republic of Macedonia in past few years was one of the segments with biggest level of expansion into the banking sector. Except by the commercial banks, the growing tendency of credit card business was adequately supported by the government policy through the introduction of project payment cards for public administration as well as with many campaigns for promotion of payment cards as a payment instrument. Expansion of payment card business in the last decade was duly followed by an increase in the number of ATM devices on the Macedonian market.The costs of the cash, without a doubt, presents a segment that should be given considerable attention in ATM operations. Banks in Macedonia, in the area of surplus funds immobilized in ATM devices, fall within the global average of around 35-40%. This part is especially important for banks that have ATM networks constituted by a large number of ATM devices. Most modern network solutions for cash management of ATM devices operate in order to ensure a satisfactory level of quality to users of ATM services and reduce operational costs in ATM operations. Almost all the solutions to anticipating the needs of cash in ATM devices on commercial banks as a basis for calculating future demand for cash has taken some historical values for shorter or longer period of time. Optimization of operating costs within the offered solutions, often despite projections of cash into account, includes other costs in this part of banking: financial costs, costs of transportation and cash management, and others. Some solutions have the opportunity for integrated alarm breach of the security level to the level of individual ATM device. By introducing methods for intelligent cash management, banks should expect higher profitability of their ATMs as a banking channel. Although banks must balance between the amount of funds, necessary to provide some solutions for intelligent cash management and the amount of saved costs connected to cash. The benefits of introducing intelligent solutions for cash management would have real positive effects in the banking operations, only if the revenues exceed the costs of implementation and maintenance of systems. Therefore banks should perform analysis based on qualitative principles before choosing the solution for intelligent management of cash depending on its own market position and business opportunities.

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