ATMs: Self-Service for the Unbanked

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13 November 2002
Neil Katkov

Abstract

Tokyo, Japan November 13, 2002

Self-service technology is enabling a new generation of product offerings by banks and other mainstream financial institutions for the unbanked. A new report from Celent Communications, ATMs: Self-Service for the Unbanked, predicts that self-service technology will be pivotal in enabling mainstream financial institutions to capture US$3.3 billion, or 22 percent, of the unbanked market by 2010.

The unbanked and underbanked sectors―representing nearly 33 million US households―have traditionally been served by a variety of alternative financial services providers, including check cashing stores, money transfer services, and alternative credit sources. From time to time, banks have attempted to enter this market, often with disappointing results. Despite this record, the growth of the alternative financial services market and the development of new self-service technologies is leading financial institutions to reevaluate the market opportunity represented by this long-overlooked sector. Banks, credit card issuers and ATM networks are instituting a number of new services, including stripped-down accounts that allow the unbanked to access payroll and government benefits payments, automated money transfer services, and the vending of money orders and prepaid cards.

"It will not be easy to coax unbanked customers into the arms of the banks, but those financial institutions that make a committed, sustained effort will be rewarded," says Neil Katkov, author of the report. "Over the next several years, financial institutions will become increasingly active in developing new services and products for the unbanked, and will be increasingly successful in winning these customers away from traditional check cashers and payday loan providers."

The report sizes the unbanked and underbanked market in terms of demographics and spending, analyzes the key alternative financial services industries, and presents a number of initiatives by banks and other financial institutions that leverage self service technology to serve the unbanked and underbanked market. The report contains 19 charts and 8 tables. A is available online.

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Content Type
Reports
Location
Asia-Pacific, EMEA, LATAM, North America