Global ATM Industry Market Size to Reach $21.9 Billion by 2020

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Nov 20, 2018, 09:00 ET

RALEIGH, North Carolina, November 20, 2018 /PRNewswire/ --

The global ATM market is expected to grow at a compounded annual growth rate of 7.6 percent to reach nearly $22 billion by 2020, as people's appetite for cash is expected to remain strong in major Asian economies of China and India, according to a latest report published by procurement intelligence firm Beroe Inc. The global ATM industry market size was around $15.2 billion in 2015. APAC is the fastest growing market in the industry with India and China leading in terms of the number of deployments.

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The U.S. and Europe are considered to be major mature markets for the ATM industry. As for the LAMEA region, there is a vacuum in the supply landscape as there is no strong presence of major global players, which could pose a challenge to procurement managers. Besides charting out engagement models and looking for industry best practices, sourcing managers in charge of procuring ATM-related services need to maintain a list of service providers (i.e., suppliers) across various regions along with their capability matrix, the report shows.

"There is a boom in ATM deployment across APAC, especially in China and India. Despite the thrust towards digital money, cash continues to be the king in major Asian economies. Trend reversals, if any, will only be apparent once the current wave of cash appetite peters out," according to Sakthi Prasad, Head of Content at Beroe Inc.

Raleigh, North Carolina-based Beroe said the report can be accessed by procurement professionals on its recently launched on-demand market intelligence platform Beroe LiVE: https://live.beroeinc.com/

Key findings from the report:

Until 2020, APAC is expected to be the fastest growing region with an annual growth rate of 10.6 percent
There is an increasing rate of technological adoption visible among the developing geographies
Emerging geographies such as India, China and Brazil are witnessing rapid growth in the deployment of ATMs. Therefore the rate of adoption of outsourced ATM services is also high
Deployment of low-cost ATMs and cheaper IP-based communication by IADs pushes initial investment costs down
Buyer power is medium to high due to high competition primarily based on pricing among the suppliers
Buyers looking for a turnkey engagement will have medium buying power, as there are fewer suppliers capable of offering end-to-end services
Turnkey contracts are preferred by large buyers to leverage on the volumes-based benefits

Beroe has conducted a market study to unravel the current scenario and future prospects for the ATM industry. The study has been done based on key technology trends, market outlook, and engagement and pricing models. The extensive research methodology for the study included:

Inputs from industry experts with at least 20 years of experience
Category-specific licensed subscriptions
Personnel involved in various stages of the value chain (buyers, suppliers, intermediaries)

For buyers, there is great potential in high maturity markets such as the U.S., Canada and the UK where there are established service providers offering end-to-end ATM services for more than two contract generations. With a steady growth rate, the outlook for ATM services industry looks attractive for all the stakeholders. This is evident from the spate of mergers and acquisitions happening in the industry with suppliers competing to improve their service capabilities to attract big players. The LAMEA region, however, seems to be only weak spot for suppliers as footprint of large players is low in this region.

The outsourcing element has also fuelled the growth of the industry as ATM services are increasingly being outsourced with buyers realizing the potential cost benefits. Technology has also become a key factor in improving the competition as customers are largely drawn by convenience and technical features that improve the safety of their transactions. This is beneficial for suppliers offering advanced features in their technology solutions to their buyers from the banking sector, the report says.

The industry adopts various engagement models such as turnkey ATM program, bundled sourcing and in-house programs. Depending on buyer's business network and requirements, a compatible model could be adopted. For merchants with high transaction volumes, the turnkey model is advantageous as the operations are completely handled by the service providers; the merchant being responsible only for the locations where the ATMs will be set up. Revenue sharing and fixed pricing are the two models that are mostly followed in the industry.

The major features of the report are:

Market Analysis