How the banks can use outsourcing.
It never ceases to amaze how many different issues or industries are turning to outsourcing as a solution to some of their problems. Not every problem at the moment is related to cash flow and debt recovery, although it may seem like that for some people, there are issues with trying to keep up with demand and pushing technology forwards. These are also important reasons to use a form of outsourcing and two of the major banks in India are looking to use outsourcing to aid the installing and maintaining of their ATM systems in the year ahead. This is part of a general rise in the trend of outsourcing ATMs and also linked to these two firms hopes of dramatically increasing the size of their network in the year ahead.
Although negotiations are in the early stages, it is believed that the Axis Bank is currently in discussion with a number of firms including BAIL, Euronet Worldwide, Prizm Payments as well as another two firms in order to conclude an agreement. At the same time, the Bank of Baroda has welcomed tenders from a number of companies who would be interested in installing and supplying ATMs as well as assisting with the maintenance of them. It is expected that the Bank of Baroda are looking to set up 500 new ATMs at a mix of locations both at their own premises and at other locations.
Using firms in this manner indicates that the benefits of outsourcing can be used to promote expansion and not just be about cost saving techniques. In fact, one of the major reasons why the Bank of Baroda are planning this rolling out of new ATMs is to further the firms hope of introducing bio-metric ATM machines. This would see the need for traditional chip-and-pin or number recognition ATMs fall and hopefully greatly improve the security aspect of the ATM. This is clearly not something that is cheap but given the customer concerns about safety and security, this move to bio-metric ATM machines could be a great leap forward for the banking industry. The Bank of Baroda is hoping to have 70 of these bio-metric machines available at the end of their roll-out.
In some countries around the world, the introduction of ATMs is greeted with displeasure and many of the outsourced machines incur a cost for the user anytime they use the machine. In more rural areas where there is not an abundance of cash machines, this can be an extremely costly affair for the user and has led to many people being unhappy with their banks for following this method of outsourcing. However, this is not the case in India with the Reserve Bank of India issuing guidelines saying customers cannot be charged for using an ATM machine which means it is not so costly an experience for bank customers in India. This guidelines means there is not the same level of stigma or anger attached to outsourcing companies working with banking firms to provide a better service for customers and hopefully make it possible for more people to gain access to their funds.
