There is a lot of hue and cry these days in banks across countries like India on whether banks should charge their customers on usage of ATM. And if yes, how much should they charge. Banks spend thousands of dollars to maintain the ATM’s. Costs include the location rent, security expenses, electricity charges and other maintenance charges. The question these bankers have is whether these costs can be recovered from the customers.
There have been a lot of internal as well as external discussions and debates around this. There are many reasons the bank may not want to charge their customers on ATM usage. Few of them are, losing customers to the competition, limited usage of ATM’s, diversion of customers to the branches eventually increasing costs, etc. However, the banks may want to go ahead and charge their customers if the costs saved are much higher than the potential losses.
Veteran bankers involved in the decision making have their own reasons to propose and oppose the idea of charging customers. The implication of any such implementation may not be standard throughout the regions, customers, branches. The implication could be different for different segments of customers. For instance, there might not be any drop in customers using the ATM in one region while there could be a drastic drop in customers accessing ATM at another region. Highly experienced bankers may not be able to predict the outcome of any such implementation with a good amount of accuracy.
The question is should few bankers take such decisions based on their experience and gut feeling? Is there a better solution which can help make better decisions. The answer is yes ! Modern day Predictive Analytics can help bankers take the right decision. The decision that is based on data and experience, and not on gut feeling. Banks have access to the huge amount of data that flows internally as well as externally. To add to this, there is data from external platforms like Social Media. Not all data are relevant. However, useful information from this data can help make better informed decisions.
In order to compete in today’s fierce competitive environment, organizations need to think innovative and out of the box. They need more insights about their business and their customers and need to ensure that they are able to meet the expectations of their internal as well as external stakeholders. The enormous amount of data, both in the form of structured and unstructured, are continuously getting generated within the internal and external systems of the organization which, if analyzed can be of immense value both to the business and as well as all stakeholders associated with the organization. The by-product of any business is a huge amount of data from different sources like Vendor Portal, CRM, HRMS, ERP, Social Media (Facebook, Twitter) etc. Analytics enables organizations to make smarter decisions and execute them when it is most beneficial to their business, its customers, and its partners—such as in real time.
Hiren Bhatia ( CFA Practice Head, Analytics )
Hiren has more than 9 years of diversified experience in the Information Technology Industry. He has tremendous Business Development experience in Business Intelligence & Analytics and ERP. He heads the Analytics Practice at Finesse and also manages the Oil & Gas initiative for Finesse.
Prior to joining Finesse, Hiren was engaged with Datamatics as a Senior Business Development Manager spearheading a team for consulting and sales of Analytics solutions. He owned and sucessfully concieved the development of Predictive and Big Data Analytics solutions for Banking, Online Retail, Telecom and Manufacturing. Hiren has been a speaker on Predictive Analytics at various prestigious events.
Hiren worked as a SAP Finance consultant at iGATE, formerly Patni Computer Systems Limited and was later involved in the Strategic Outsourcing Group as a Consultant for large system integration deals in various sectors including BFSI, Telecom, Manufacturing and Government.
Hiren has secured his MBA in IT management from S P Jain Center of Management and is a Bachelor of Engineer in Computer Science from Mumbai University. Hiren is a CFA Charterholder from the CFA Institute in USA. Prior to his MBA, he was working with Hexaware Technologies Ltd. in the Financial Securities domain on Business Intelligence & Datawarehouse platform.