Where Did All the ATMs Go?

Automated Teller Machines (ATMs) have long been a staple of the banking experience, providing convenient access to cash and basic banking services. However, the Australian banking landscape has witnessed a significant shift in the availability and usage of ATMs since 2017.

In this article, we explore the current state of ATM operations in Australia and examine the reasons behind the decline in the number of bank ATMs.

The changing ATM landscape in Australia

Over the past few years, the number of ATMs in Australia has experienced a noticeable decline. The APRA reported that the ATM population in Australia went from an estimated 13,814 in 2017 to 6,412 as of June 2022. The decrease is primarily attributed to two significant factors: the changing preferences of consumers and the rise of digital banking solutions.

Changing consumer preferences

One key reason for the decline in bank ATMs is the changing preferences of consumers. With the increasing popularity of digital banking and the widespread adoption of contactless payments, customers have become less reliant on cash transactions. As a result, the demand for ATM services has decreased, leading to a reassessment of ATM placement and operations by banks.

Rise of digital banking solutions

The advent of digital banking solutions, including mobile banking apps and online platforms, has revolutionised the way people manage their finances. These convenient alternatives offer customers the ability to perform various banking transactions without the need for physical ATMs. Features such as mobile check deposits, fund transfers, and bill payments can be done with just a few taps on a smartphone, reducing the need for in-person interactions at ATMs.

Factors contributing to the decline

Several factors have contributed to the decline in the number of bank ATMs across Australia.

Cost considerations

Operating and maintaining a network of ATMs can be expensive for banks. Factors such as installation costs, equipment maintenance, cash replenishment, and security measures all contribute to the overall expense. As the demand for ATM services declines, banks have been reevaluating the cost-effectiveness of maintaining large ATM networks.

Network rationalisation

To adapt to changing consumer preferences and optimise their services, banks have undertaken network rationalisation strategies. This involves reviewing the location and density of ATMs to ensure they are strategically placed in areas of higher demand. As a result, less frequented ATMs in remote or low-traffic areas have been closed or consolidated.

Partnerships and outsourcing

To streamline operations and reduce costs, banks have entered into partnerships and outsourcing arrangements with independent ATM operators. These partnerships allow banks to maintain a presence in key locations while sharing the operational and maintenance expenses with third-party operators.

Accessibility regulations

Accessibility regulations have played a role in the decline of bank ATMs as well. In recent years, there has been a greater focus on ensuring that ATMs are accessible to all individuals, including those with disabilities. Upgrading existing ATMs to meet accessibility requirements can be costly, leading some banks to opt for alternative solutions or consolidated ATM locations.

A dark side?

Some sectors claim that an ATM may be helpful in terms of using cash for certain purposes. News.com.au’s Mary Madigan took note of some GenZ Australians who wanted to use cash to buy illegal substances. These people, however, are more leaning towards using current transactional methods such as credit or debit cards, or BNPL apps linked to a phone, for other ordinary transactions.

The future of ATMs

While the number of bank ATMs has declined, it does not necessarily mean that they are on the verge of extinction. ATMs still hold value for certain transactions and customer segments, especially in areas where digital infrastructure may be limited or where cash remains a preferred payment method.

In remote areas or regions with limited digital infrastructure, ATMs continue to serve as a crucial access point for banking services. They provide a lifeline for individuals who rely on cash transactions and may not have access to alternative digital banking solutions. Additionally, ATMs remain essential for tourists and international visitors who may require access to local currency.

To adapt to the evolving needs of customers, banks have been incorporating innovative features into their ATMs. Contactless card payments, for instance, allow customers to tap their cards instead of inserting them into the machine, enhancing convenience and reducing physical contact. Some ATMs also offer additional self-service options, such as check deposits and account balance inquiries, expanding their functionality beyond just cash withdrawals.

While the traditional bank ATM network has undergone significant changes, it is important to note that ATMs still have a role to play in the banking ecosystem. As the decline in their numbers reflects the changing landscape, there are still instances where physical ATMs provide value and convenience.

Furthermore, independent ATM operators have emerged as key players in the ATM landscape. These operators, often partnering with multiple banks, provide convenient access to ATMs in various locations. By collaborating with these operators, banks can maintain a presence in strategic areas while sharing the costs and responsibilities of ATM operations.

UBUDGET, provided by UBOMI, empowers users to manage their finances by setting and monitoring budgets, thus giving them increased control. This is a formidable resource that can assist in accomplishing personal targets.

If you liked our “Where Did All the ATMs Go?” and find it useful, check our blogs regularly for more information to get updates on UBOMI’s money planner app.

DISCLAIMER:  This article is for informational purposes only. UBOMI has no relationships with any company or organisation mentioned in the article.