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© 2014 Networld Media Group | Sponsored by GRG Banking

Banks struggling to cope with the cost of maintaining a presence in low- traffic areas typically have relied on the ATM as a cost-efficient way to serve customers.

In addition, banks often face the situation where they may wish to trim costs by shifting some transactions in a branch from the teller to a self-service solution.

However, there always will be situations where a customer requires personal service that may be beyond the scope of a traditional ATM, such as open-ing an account, purchasing financial products or applying for credit. In those cases, a video teller machine may prove to be the solution.

Benefits for both sidesVideo teller machines, also known as VTMs, have been around for several years, although developments in teleconferencing technology have made them much more feasible. VTMs incorporate many of the features available via an ATM as well as offering the ability to conduct a video chat with a live agent and transact other business outside the normal range of ATM’s functionality.

Video teller machines allow banks to deliver personal service without the need for a physical branch.

By Richard Slawsky ATMmarketplace.com

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Video Teller Machines (VTMs) as a Bank Branch Alternative

“The VTM is a very good solution for market penetration because it is less costly than a physical branch” — Mustafa Dereci, marketing and product development group manager with Kuveyt Turk Participation Bank.

VTMs are installed in special digital branches. The bank even deploys a staff to help educate customers at the initial promoting stage.

VideoTeller Machines (VTMs) as a Bank Branch Alternative

2© 2014 Networld Media Group | Sponsored by GRG Banking

VTMs incorporate the features of an ATM, bank branch and call center as well as mobile and internet banking to create a new channel to serve custom-ers. The VTM offers a full range of banking services to both corporate and retail customers.

Compared with a traditional branch the VTM carries much lower fixed and operational costs, enabling a financial institution to expand its reach at a significant saving. Real-time visual and biometric processes help deter illegal usage even in the case of a stolen ID, and the video record kept by the VTM serves as added security.

Kuveyt Turk Participation Bank in Turkey, for example, launched digital branches centered on VTMs in 2013. The bank has since set up 22 such digital branches with plans to expand to 50 in 2014. The solution was devel-oped by China-based GRGBanking.

The bank’s digital branches feature a small waiting area with seats for cus-tomers and a security station for a guard. The VTM is located in a separate room where customers can conduct business in private.

The VTMs feature a touchscreen for data entry, a separate screen for video conferencing and a document scanner for IDs and signed forms. Customers can withdraw cash and make deposits, open a variety of accounts and speak with a live agent to arrange loans and other transactions..

“The VTM is a very good solution for market penetration because it is less costly than a physical branch,” said Mustafa Dereci, marketing and product development group manager with Kuveyt Turk Participation Bank. “And on the customer side, they can receive any service and buy any product seven days a week, 24 hours a day, without interruption and without eliminating that human interaction, because there are people on the other side serving those customers.”

Enabling growth in a competitive marketChina Guangfa Bank is one of the first joint-stock commercial banks in China and operates in 61 cities around the country. As of the end of 2012, the bank had $192 billion (USD) in assets and had issued 20 million credit cards.

With only 630 branches, the bank was looking for an innovative solution that would enable it to grow quickly while differentiating itself from its com-petitors. VTMs, custom designed by GRGBanking, were that solution. In July 2012, the bank introduced the first VTM in China.

“With this solution, small or average-size banks can become a very seri-ous players and strong competitors to large and well-established banks in

The first VTM in China, it is 24 hour remote teller service accessible.

VideoTeller Machines (VTMs) as a Bank Branch Alternative

3© 2014 Networld Media Group | Sponsored by GRG Banking

a very short time,” said Pranas Griskevicius, regional sales director with GRGBanking. “At the same time, customers have the opportunity to use the services of the bank around the clock, and at a time and place that’s convenient for them.”

The bank’s VTMs target retail banking, with a comprehensive system that integrates access control and real-time HD video conferencing to provide high-end services for VIP customers. It also provides the bank with a lower cost channel for expansion into low-traffic areas than could be provided with a traditional branch.

The VTMs all are deployed in private cabins with strict access control. Customers use their ID cards for access, and when they enter the cabin video conferencing is already activated. Remote tellers are available 24/7, so customers can perform banking transactions after work in the evenings and during the weekends.

Opening accounts is the most popular transaction performed at the VTMs. Customers can open an account in five to six minutes and receive a debit card instantly versus having to wait in line for 15 minutes before even being able to start an application. The bank’s VTMs currently process up to 70 transactions a day.

Migrating services to the self-service channelThanks to the tremendous growth of the banking industry in China and because customers in that country prefer human interaction and personal service, bank branches are under immense pressure to serve a large num-ber of customers each day.

Bank of Communications, China’s fifth-largest bank with more than 2,700 branches and $865 billion (USD) in assets, was seeking a better way to serve its customers and relieve over-crowding at the counter. The bank deployed VTMs in an effort to migrate counter services to the self-service channel.

GRG provided two versions of VTMs to the bank. The professional version is designed for retail banking and supports cash recycling, passbook, ac-count opening, card issuing, financing, loan applications, foreign exchange transactions and more. The comprehensive version offers all of those services as well as corporate banking services.

Although most transactions are designed to be self-service, if customer ID authentication is required or the customer needs assistance, the machine will connect to a remote teller via video conferencing. The remote teller has

Installed in a hospital, citizens can apply for debit cards jointly issued by the bank and the hospital. It also supports corporate banking transactions to the hospital staff.

VideoTeller Machines (VTMs) as a Bank Branch Alternative

4© 2014 Networld Media Group | Sponsored by GRG Banking

GRGBanking, located in Guangzhou, China, has been engaged in R&D, manufacturing, sales and service of ATMs and other self-service solutions for retailers and financial institutions for more than 20 years. The company is one of the top ATM providers in China, and its applications and products are available in more than 70 countries. The product and service portfolio of GRG covers financial self-service terminals, retail deposit terminals, cash and check processing mod-ules, software solutions and Automatic Fare Collection System together with technical support and services.

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Case study - Commerzbank AG

the ability to share, control and present information on the machine’s opera-tion screen.

GRG worked with the bank to put 128 VTMs in service in more than 65 cities in China by February 2014. The terminals are mostly located in the 24-hour self-service zone of the branches, with a bank employee guiding customers to the devices at the initial stage.

The bank also deployed VTMs to locations such as train stations, hospitals, residential communities, universities and other public areas to function as a “mini branch.” In some areas, the terminals are performing as many as 50 transactions a day.

“I don’t think VTMs will replace the branch 100 percent, but they will be-come the access point for a large number of services for everyday custom-ers.” Griskevicius said. “They already have made a significant reduction in the number of the tellers working in the bank.”

“I don’t think VTMs will replace the branch 100 percent, but they will become the access point for a large number of services for everyday customers” — Pranas Griskevicius, regional sales director with GRGBanking.

In December 2013 German FI Commerzbank AG revealed its new branch strategy with the opening of its reinvented branch in Berlin — the first in Germany to use a VTM (called a “Videokasse”) to extend banking hours and better serve customers.

Commerzbank operates 1,200 branches, and boasts one of the most dense branch networks among German private banks. The FI serves nearly 15 million private customers, as well as 1 million business and corporate clients. In 2012, it generated revenues of just under 10 billion euros.

The GRGBanking VTM increases the availability of professional financial advice and bank counter service at the branch, increasing open hours by 80 percent, including weekends, the company said in a news release.

Modules and functions integrated into the machine include cash deposit, cash withdrawal, money exchange, check and document scanning, ID card-reading and digital signature input.

Monika Hermes, project leader at Commerzbank, said the VTM will become an important additional channel and customer touchpoint. “Customers will love the outstanding design and the innovative way of communication,” she said.

A customer conducting counter transactions through the first VTM in Germany via HD video interaction.