The Knowledge to Decide

The future of financial services is all about digitalization. This much is well known. What is less well known is that this is also the reason why banking transactions might be driven by non-bank disruptors in the coming years. How well will future innovations such as e-currencies be integrated into the banking industry? Will cash become obsolete? Jeffrey Bahar, Deputy Chief Executive Officer of Spire Research and Consulting, reflects on the drastic changes happening in financial transactions today. The combination of digital cash and virtual currencies has inevitably curbed the usage of cash in developed markets and across many Asia-Pacific countries. Cash as we know it might lose its status as the dominant form of payment by volume in the coming years – unless banks create innovative new modes of payments to counter the trend. Bahar opined that mobile penetration would continue to rise in the developing Asia-Pacific markets. Unbanked and under-banked market segments would inc

Indonesian banks have launched a novel channel that allows customers to withdraw cash through drive-through automated teller machines (ATMs). However, Jeffrey Bahar, Deputy Chief Executive Officer of Spire Research and Consulting, sounded a cautionary note on the risks and limitations of the new platform. Drive-through ATMs have become more common in countries across the Asia Pacific, such as China (through Citibank), Australia (through Bendigo Bank and NAB) and particularly Indonesia. Bank Negara Indonesia (BNI) first launched its drive-through ATM service in 2004, and is now seeing an average usage rate of approximately 7,600 transactions per month in each of its 29 drive-through destinations. BNI plans to expand this service with an additional 15 new drive-through ATMs for motorcycles in 2014. However, Bahar commented that security concerns – especially issues pertaining to magnetic ATM card cloning and robbery – would deter customers from transacting at drive-through ATMs