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Outsourcing vs. insourcing processing ATMs and commercial deposits

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Count ATM deposit money faster, more efficiently in the branch on better machines

Do you outsource or insource functions within your financial institution? In the past decade, there has been a trend toward outsourcing, but now the pendulum seems to be swinging the other way.

A branch transformation juggernaut has hit the financial industry, with many traditional branch functions like transactions, withdrawals and deposits being automated either via ATMs or remote deposit capabilities. But one thing that hasn't changed: banks and credit unions still need to process their commercial and ATM deposits. This function, which has previously been outsourced, is being brought back in-house more and more. Let's take a look at why that is.

Within the past 10 to 20 years or so, financial institutions turned to outsourcing as a way of standardizing business processes, with the goal of leveraging outside expertise and achieving cost savings. What did they outsource? One big area was the processing of deposits from ATMs and commercial accounts. Armored carriers would pick up the cash and take it away to be processed, saving time and effort at the branch. Good idea? To a point. But then things changed.

The armored transport market. It's not a monopoly, but it was dominated by a few key companies.

The paradox of sending cash away. Branches need it on hand for ATMs and for transactions. The inventory shortage caused by sending cash off-site to be processed became a problem.

Interest rates have been low, but they're on the rise and expected to rise more. This coupled with high cash-order and transportation fees has led some banks and credit unions to begin exploring more cost-effective and efficient options.

Processing cash and checks in-house is becoming mission critical for financial institutions, and that requires the right equipment.

State-of-the-art technology, including multi-pocket cash sorters that are faster, easier to use and more customizable than ever before, make it possible, and economical, to process cash in-house.

December 7, 2018