Should banks trust same vendors to “mark their own homework”?

True vendor independence and open standards functionality is becoming increasingly important in the US as well as elsewhere, with increased regulation and economic instability impacting banks across the board. So what does true open architecture ATM technology mean in today’s banking environment?

Open standards-based ATM software solutions offer financial institutions the ability to effectively unlock the potential of the ATM and self-service channel. Using open standards-based technology, financial institutions can select alternative suppliers for their ATM and self-service software, as long as their technology conforms to XFS specifications, and also be able to interact more easily with other third-party applications on the ATM. This approach allows banks to reduce costs through effective commoditisation of the hardware, decreased software costs, and increased customer service levels through providing a consistent user interface across multiple types of ATM hardware.

By removing the proprietary lock on the ATM network, hardware vendors are forced to compete with independent software vendors, and banks can truly have the ability to select the solutions that are right for their institution.

However, this lock on the ATM network is still being maintained as vendors bundle their software, services and hardware together into one seemingly comprehensive package. This not only allows for a very opaque pricing structure but also makes it harder for banks to have the checks and balances necessary for an unbiased picture of how the ATM network is operating. Using the bundling system, the same ATM hardware provider tests and monitors its performance and reliability. The question remains, should banks trust those same vendors to “mark their own homework”?

Steven Lund