The American Business Journal: uGenius video banking

uGenius video banking
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admin on 21 August, 2010 12:14:00
 
“I’ve been working on this concept for a long time, but it really
started when I was having dinner in 2001 with a client who had a desire to
remove their teller lines and replace them with this type of device,” said
Gene Pranger, creator of uGenius Technologies, a company “that connects
businesses to their customers with innovative personal transaction
solutions”.
The latest innovation in video banking technology, Gene Pranger Creating Smarter
Branches was formed as the initial company in 1995. Since then, the company has
designed financial institutions, retail branches and credit unions across North
America. Since its inception, heavy investment in technology has contributed to
the development of the Personal Teller System (PTS), a banking machine where the
customer has the ability to talk and see a teller, located in a central call
centre.
According to the company’s website, the financial services industry is
under pressure to break out of old thinking and leverage innovation to reduce
costs, grow deposits and delight consumers. The world of retail banking has
changed, adapting to become hyper efficient and effective in business, or risk
business viability.
The PTS can replace traditional tellers and financial institutions using this
strategy have found overwhelmingly positive customer acceptance, while reducing
its tellers by half. With customer convenience as the key for future growth,
extended operating can make a difference in marketplace, “transforming the
dynamics and creating a large difference in profitability”.
Personal Teller System
The machine has all the functionality of a full service ATM, and 95 per cent of
the traditional teller functionality, with the addition of printing cheques and
coin dispensing, while it can also accept cash and dispense cash, coins, cheques
and receipts. By the end of this year, about 100 devices will be installed
throughout North America.
“My hat really goes off to Ontario [FirstOntario Credit Union] for being
the first in Canada to adopt the technology because they certainly didn’t
have to,” said Pranger. “They could have just taken a step back and
said, ‘Let somebody else try it before we put our toe in that
water’. Instead, they embraced it and now they’re rolling it out to
three or four other branches in the Greater Toronto Area, finding good customer
adoption in their marketplace.”
Financial institution strategies
So how does a PTS differ from the traditional ATM?
“I believe these machines have a different strategic use. The biggest
problem people have had with a full service ATM is with depositing cheques in
that they don’t quite trust what happens to their cheque,” said
Pranger. “They never find out where it goes until it’s posted to
their account and sometimes that doesn’t happen until 48 hours later. In
the case of a full service PTS, you have the ability to see and talk to a person
on the other end. They can verify on the spot.”
Product development and vision
Promoting the product after the research and development, the product started
rolling out in October 2008.
“I think the number one factor for the success of a product is the vision
financial institutions have in wanting to service their customers in a more
convenient and more efficient way,” added Pranger. “Driving the
success of this product is all the clients adopting it and the visionary skill
of the people that are leading financial institutions and deploying it.
“In a recent survey we asked, ‘Will video banking affect customer
switching behaviour?’ Meaning, if a customer knows a competitive financial
institution has a video banking experience and they can access it at any time,
32 per cent of the general consumer said they are more likely to switch to a
financial institution offering extended hours through PTS. I think that’s
just an amazing statistic.”
Competitive landscape
A developing industry, uGenius has yet to see much competition in video banking,
but believes that trend will change in the next two to three years.
“We recently did a study on how consumers accept the video banking within
existing branches and 90 per cent of the users are satisfied with their
experience, so we are really pleased with our impact. When you have that type of
consumer satisfaction rate, it bodes very well for the product,” said
Pranger.
Centralized banking
According to Pranger, opportunities to reduce overall cost structure of
financial institutions greatly exist, in multiple respects.
“Instead of having a teller at one location and the branch goes dead for
20 minutes, if you put them in a central location, they can handle not just that
branch, but multiple branches,” explained Pranger. “We feel we can
bring down the teller staffing cost by upwards of 50 per cent for financial
institutions through a large scale deployment of PTS.
“Even a bigger chuck of the pie, is that it changes the way branches can
be designed today and in the future. Instead of having a 3,000 to 5,000 square
foot branch, you can reduce all the way down to 16 square feet because the box
itself is around four square feet.”
Financial institute space typically designed for tellers and lines can now be
devoted to new sales opportunities or downsized entirely, noting that the branch
focus changes from transaction-focused to a sales and services oriented.
“Instead of the branch manager focusing on ‘How is my teller line
operating today?’ they can build their market through the community and
new business opportunities,” said Pranger. “We save money for the
financial institutions but we also make them money.”
ugenius.com