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1bmafish

289 Posts.

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25/09/17

07:44

Post #: 27428136
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Originally posted by sharks37 ↑

Timber? Rubbish.

Users of ATMs already have been able to use ATMs without paying fees - from ATMs from their own bank. Yet the article says:

1. That Australians in the last year paid $500M in ATM fees
2. 40% of the 50 million daily ATM transactions have a fee

Clearly despite having access to fee-free ATM transactions from their own bank, a lot of people choose to transact at ATMs where they incur a fee. Why? Because an ATM from their own bank is not conveniently located near them at the time they want to withdraw cash. So clearly many people are prepared to pay for the convenience of being able to withdraw cash when/where they need it, rather than having to go out of their way to find an ATM from their own bank.

So the principle of willingness to pay for cash withdrawal convenience has been clearly established.

Now a % of the above fee-paying transactions will be at ATMs from the other 3 of the big 4 banks, which are at locations wherever people are that is convenient to them. These will become free. But there are also obviously a lot of locations where independent ATMs are located that are far enough away from major bank ATMs that the price of convenience will still be paid - a price that many people have demonstrated they are willing to pay when it is convenient for them.

Personally I believe there is actually an opportunity here for STL rather than a threat. Since those 4 major bank ATMs will now not be generating any fees they will become a cost only piece of infrastructure for the big 4 banks. I can see them reducing ATM numbers as Oxxa suggested but I can also see them outsourcing the servicing or operation of those ATMs to someone like STL as a subcontractor who would have to bid for such outsourcing contracts - and who better to bid for and win such contracts than the 2nd biggest ATM provider in the country that is vertically integrated, a part owner of an ATM manufacturer, and with their own switching network so able to bid competitively against higher cost competitors because of their low costs.

Shifts in industry dynamics like this can pose threats but they can also present opportunities to players in the right place at the right time with the right capabilities. Personally, I wouldn't be surprised if Todd has seen this coming and what has he been doing - buying more STL stock.

Cheers, Sharks

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Wow didnt see that coming from the big 4. Think there will be some panic selling today....in my opinion this should present bargin SP pricing. Agree with the popular opinion that this will reduce the number of ATMs in operation in Aussie and or also a good theory that we are geared up to get busy helping the banks reduce ATM cost by outsaucing the operation of ATM process. We do also need to remember the STL business is morphing into far more than just ATM end to end process owner/manager.
Thanks
Fish

Last edited by 1bmafish: 25/09/17

STL Price at posting: 2.4¢ Sentiment: Buy Disclosure: Held
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