Four Places Your Branch May be Stockpiling Excess Cash


Whether a financial institution has 10 branches, or more than 100; they all face similar challenges when it comes to branch cash management. My colleague previously discussed that banks and credit unions shouldn’t fear running out of cash. However, there are many reasons a branch might feel the need to keep more cash-on-hand then they need, or in some cases they may not be aware of where the excess cash is.

As financial institutions continue to go through branch transformation and add new devices to improve their customer experience, it is also important to review all cash end points and update branch cash management and ordering processes to grow and adapt. However, this is often overlooked and leads to storing excess cash in the branch or devices.

Here are four places a branch might find excess cash:


I recommend taking a walk into your branches’ vaults and checking the date on the oldest cash strap. If the date is more than three months old, I would say there’s more cash there than you need for customer requests. Why is the cash in the vault not being used, but continues to be replenished to the limit? I predict it’s because the frontline team members are now using what I like to call the “secondary vaults,” AKA recyclers, for all their cash fulfillments, and no longer are using the vault to reload.


In my experience, I’ve noticed many frontline staff members use recyclers as a second vault. They are inputting and pulling cash from the machines without ever having to access the traditional vault. This is a great improvement in efficiency, security and counting. However, to reduce excess cash the total amount of usage for both the vault and the recyclers needs to be taken into consideration before each order. If not, branch managers will order with only the recyclers’ replenishment in mind and end up adding to the storage of cash already in the vault.


Through speaking with many banks and credit unions, I’ve learned that ATM or branch managers often max out the cassettes in ATMs and ITMs. This is for one of two reasons: so they don’t have to worry about running out of cash or they don’t know how much cash the ATM or ITM uses between fulfillments and how that fluctuates over time.


Whether it’s the cash in the vault, recyclers or ATMs/ITMs, if a branch doesn’t need a certain amount of a denomination, then it sits there and collects dust. Denominations are often missed when thinking about branch cash management. It’s a common fear among frontline staff that they won’t be able to meet a specific denomination request. I recommend that financial institutions look at their historical cash usage data by denominations to prevent over-ordering an underused denomination and possibly depositing excess cash in those denominations.

I understand it can be difficult to truly understand your branches’ total cash usage, including teller drawers, ATMs, ITMs, CDMs and recyclers. This is why I recommend banks and credit unions use a third party software to analyze inflow, outflow and needs for each cash end point; especially if they’re going through branch transformation, or adding in new devices. Excess cash is useless, and by being aware of the varying needs of a branches’ cash end points, you’ll have less excess and more money to increase profits.

Cash Management Tip Sheet