Statements About ATMs Included Fallacies
In the article about growing business (CU Journal, Oct. 2), I was astounded by the advice offered in regard to ATMs. While acknowledging the "SEGs love ATMs," the advice is that "When an ATM's too expensive..." reach out with an automated telephone center that hooks up with an audio response system or a member service representative.
The first fallacy here is that consumers demand 24-hour/365-day access to their money, and if you aren't offering it, there are numerous alternatives who do. If you cannot deliver, you will most assuredly lose prospects and members to those who can. The question isn't if you can afford ATMs. The question is, can you afford to forfeit the lion's share of the market?
The second fallacy is substituting a call line for a cash dispenser/transaction performer. It's like saying, if you can't afford a power saw, buy a frying pan. Both useful implements, but hardly interchangeable. Over 90% of ATM transactions are cash withdrawal. How are you going to do that over the phone? How will you take a deposit?
The third fallacy is the cost factor, since prices of ATMs have declined dramatically over the years, and fully refurbished and used machines are available for even less. They consume little more than electricity and a few rolls of paper, while working 24-hours/365-days. Compare that to the personnel on the phone line. Their salary, taxes, benefits, supervision, time off, etc. will cost more in four months than the purchase price of the ATM, and the personnel expense will continue to hit you every week ad infinitum! On top of this, where is the member service person when a member needs something 7:00 p.m. on a Sunday?
It just boils down to common sense. If one grocery store offers you the convenience of shopping carts and another one doesn't, you'll go with the one that provides what you want. It's no different in financial services.
Henry E. Dorfman, Vice President-ATM Exchange, Cincinnati, Ohio
Judge Right About NCUA And Capcorp
The most important thing I've read in any credit union publication in the last few years was the statement by Judge Nickerson, affirming what we have all known for the last several years about NCUA's heavy handed action with Cap Corp (CU Journal, Oct. 2). "Lastly," Judge Nickerson wrote, "the actual losses were due, not to (the broker's) failure to register, but to NCUA's premature sale of the CMOs. Had the CMOs been held to maturity, as was CapCorp's intent, there would have been no losses."
This comment should be put in every examiner's hand book. When an investment goes south, if it is a good investment, it will pay back in time. No need to force a sale. This is a real indictment of NCUA. Moreover, there was probably no need to fold Cap Corp.
Phil Matous, CEO-Taylor Community Credit Union, Taylor, Mich.
