For many, the words ‘banking’ and ‘sustainability’ may not often be used together. But increasingly, consumers are looking to corporations and institutions to incorporate eco-consciousness into their business practices, pushing the demand for sustainability for banks, credit unions, and other financial institutions along the way. While green initiatives in the banking industry are usually associated with investments, there are many other ways that the banking industry can reduce its carbon footprint and show customers that its business practices are both relevant and conscientious.
Cash handling is one of them. Even as our society becomes increasingly cashless, cash still plays a large role in the daily operations of banks, including staff workflow demands as well as the outside costs associated with secure cash handling. From calibrating cash needs with available cash-on-hand to quickly and accurately counting receipts, there are many components of FI cash management that can leave room for improvements in operational efficiencies. Attacking these same pain points can often have the upshot of decreasing negative environmental impacts, which is critical in many customers’ viewpoints.
In this post, we’ll discuss how the future of banking technology must keep sustainability in mind for banks to remain both competitive and trusted. Simple steps, like incorporating modern technology such as teller cash recyclers (TCRs), can help you achieve your sustainability goals.
The Importance of Sustainability in Banking
Increasingly, customers—especially younger generations—are considering business’s sustainable practices when choosing which companies to patronize. As the World Economic Forum points out, 71% of Millennials and 75% of Generation Z give preference to companies with sustainable practices over traditionally trusted brands. Implementing sustainable practices is essential to showing your customer base that you care about the impact your business makes on the world around you. Let’s take a closer look at some of the important ways increasing your bank’s sustainability can be beneficial.
Reputation Management
With recent bank failures, many Americans’ trust in financial institutions has been shaken. In fact, a recent poll found that only 10% of Americans have faith in our banks. One critical way to increase trust and faith in banks is to incorporate sustainable practices into everyday bank management. As the recent study by the University Sheffield, “Interpreting banks’ sustainability initiatives as reputational risk management and mechanisms for coping, re-embedding and rebuilding societal trust” argues, “reputational risk management is partly if not wholly driving sustainability initiatives.” As the authors write, these initiatives are for many banks “a means of rebuilding societal trust in the banking sector.”
When you take the initiative to add sustainable practices to your bank management, it can have a significant impact on your bank’s reputation, and your bank can have the unique opportunity to carve a niche for itself, ahead of the competition. As McKinsey Sustainability explains in their article, Green growth: Unlocking sustainability opportunities for retail banks, “Even after five-plus years of green efforts, including paperless billing and social responsibility pushes, financial institutions have yet to establish themselves as credible partners on the climate transition. Firms can start working now on defining and communicating an engaging, accessible climate brand to support their product and service ambitions, or risk remaining in the middle of the pack.”
Social Responsibility
While individuals all have a responsibility to make choices that reduce environmental harm, it’s businesses that can make the most impact. Because businesses have a much larger effect due to their sheer scale, every choice your bank makes can have an outsized one. And, as American Banker points out, when your FI adopts sustainable practices that limit consumption, like going paperless, it can simultaneously save you money and make your processes more efficient, all while promoting a greener future.
Improved Efficiencies
As we mentioned above, sustainable practices can have layered benefits for banks. While helping the environment is often an integral part of an organization’s mission, FIs must remain focused on their bottom line to stay competitive and best serve their customers. Many green initiatives including TCR implementation, drastically improve efficiency, thus reducing overhead. On average, financial institutions save 20% in operational costs when implementing TCRs with an integrated cash management solution. Key takeaway: sustainability initiatives can make a positive impact on both the environment and a company’s wallet.
Maintaining Competitive Advantage
Corporate Social Responsibility (CSR) initiatives have become a qualifier to compete in today’s business environment. As the same study by the University of Sheffield referenced above explains, concerns for environmental and social issues care creating “societal expectations that banks and other financial institutions should be acting more responsibly […and] these societal expectations also represent significant reputational risks for banks that are not adopting sustainability initiatives.”
In other words, by not prioritizing CSR initiatives, you may be putting your FI at risk of falling behind. According to the Governance & Accountability Institute Inc, 90% of S&P 500 Index companies already published sustainability reports in 2019 detailing their environmental practices—and that number is growing.
How can TCRs help move your bank to a more sustainable future?
There are numerous ways that you can increase your sustainable efforts at your FI, but the focus is often on customer-based impact-reduction activities, from promoting paperless statements to offering ESG investment options. However, some of the most beneficial options are often less obvious, minimizing impacts by improving efficiencies behind-the-scenes—within your everyday operations. Employing modern teller cash recyclers is just one way that you can do that.
Here’s how:
TCRs Can Decrease Your Carbon Footprint
Cash Inventory Visibility: FIs have a better read on how much cash your FI has on hand vs. how much cash is needed. This extra visibility can give you a better understanding of your cash availability, which can help you better synchronize your cash transit pickups with your current needs. Armed with more accurate knowledge, staff will be less likely to overorder cash or overschedule pickups.
Modern Equipment Can Lower Your Energy Consumption
Advanced Energy-Efficient Features: Modern TCRs often come with built-in power saving modes and operate using less electricity than many traditional products used for cash handling. This energy efficiency can help lower the overall energy consumption of your banking operations. Moreover, TCRs automatically power down during periods of inactivity, leading to additional energy savings.
Digitalization Reducing Energy Use: TCRs can contribute to your bank’s larger digitization efforts, reducing the need for energy-intensive activities such as manual cash counting, sorting, and physical storage. By using new banking technology to streamline these processes and make them more efficient, banks can achieve significant energy savings.
Reduction in Cooling and Heating Requirements: TCRs are compact, highly efficient machines that generate less heat than traditional ATMs and other banking equipment. As a result, the cooling or heating requirements for the areas housing these machines are reduced, contributing to lower overall energy consumption.
TCRs Promote a Circular Economy
Extending the Life of Banknotes: Modern TCRs can minimize damage to bank notes over other forms of cash counting and older machinery, playing a crucial role in ensuring that banknotes are circulated for as long as possible before being retired or destroyed. By doing so, they save resources and decrease the environmental impact associated with the production and transportation of new banknotes.
Reducing the Demand for New Banknotes: TCRs authenticate and recycle cash within the bank’s internal operations. This process ensures that only unfit banknotes are taken out of circulation, while fit ones continue to be reused, reducing the need for fresh banknote production.
Longevity-Minded, Recycling-Friendly Machines
As a proven modern machine, each TCR itself will have a long life span—and the TCRs we offer are specifically chosen for their quality, durability, and longevity. When it is finally time to discard your TCR, these machines contain recyclable components, and can be broken down into multiple parts for recycling purposes. Valuable materials can be extracted from the machine and reused in new products, reducing the need for new raw materials.
Steps to Successfully Implement TCRs in Your Branch
As with many sustainability or branch transformation initiatives, simply purchasing TCRs for your FI’s branches is not the most effective way to make the most of their impact. From choosing the right equipment provider to introducing staff and customers to their benefits, here’s how to get it right.
Prepare and train your staff.
New technology can be overwhelming and intimidating if employees think their jobs might be replaced. Ensure you have employee buy-in. Explain the teller cash recycler benefits, provide peace of mind about job security, and implement effective training to handle TCRs properly and efficiently. TCRs can offer relief to an overburdened staff and be a welcome addition to any branch if their introduction and rollout is thoughtful and well-planned.
Find a reliable and experienced TCR sales and service provider.
While you may find TCR equipment from national retailers, at Shields we have been a leading FI service provider in the NJ, PA, DE, and NY region for over 50 years. Our strategic partnerships with NCR, ATEC, and Fenco offer access to the latest and greatest in FI technology, equipping your bank with the same devices as the global industry leaders, paired with the benefits of working with a local, dedicated company.
Promote your bank’s sustainability initiatives.
By implementing TCRs, banks are making tangible changes towards a greener future. So why not talk about it? Include CSR initiatives like TCR implementation in your marketing material, or consider writing an environmental report that can be made available to the public. While other institutions may partake in “green washing”, or making overstated or downright false claims about a company’s environmental initiatives for marketing purposes, your bank will be able to point to a clear, physical implementation of environmentally-friendly banking practices.
Partner with Shields and Make an Impact on Your Community
When you need a dependable, regionally-based partner to facilitate your sustainable branch transformation, turn to Shields. From energy and time-efficient Teller Cash Recyclers and ATMs to refreshing, modern lobby upgrades that balance the comforts of customers and staff, we offer sustainable products and services that can keep your branch competitive.
Shields Business Solutions is ready to be your partner on the journey to banking sustainability. Contact our team to learn more about our mission and how we can help you leverage teller cash recyclers and other sustainable financial solutions.
