Banks Use Coin Counting Machines To Attract Customers
BOSTON (CBS) – Change-counting machines seem as quaint as dialing a rotary telephone, but they’re making a comeback with some banks whose executives see them as a way to get people into branches and snag new customers.
TD Bank, the state’s fourth-largest by assets, has coin counting machines in 1,113 of its branches, which range from Maine to Florida.
About 97 of those are in Massachusetts.
Every time TD opens a new branch, it puts in a coin machine, named “Penny Arcade.”
Most branches have one machine for adults and another closer to the ground for children.
Why is TD so keen on installing Penny in its branches?
The coin machines bring in new business.
In 2011, TD opened 85,212 new accounts by turning non-customers into bank members following a Penny Arcade experience.
Using the machines is free for bank members, while non-customers pay a 6 percent fee. The bank started installing the coin machines in its branches in 1999.
“They are very popular,” Marion Colombo, TD Bank’s senior vice president of retail banking told the Boston Business Journal.
“They’re an extension of our plan. It’s really cool to be able to engage people when they do bring them in like that. We’re pretty excited to see a kid come in with their jug of money.”
Children can guess how many coins they have, and if one comes within $1.99, the bank gives him or her a TD-branded prize, such as a bookmark or package of garden seeds.
Last year, Penny processed 31 billion coins for TD, 49 percent of which were pennies. TD’s machine counts 3,500 coins a minute.
Each self-service coin kiosk costs between $14,000 to $20,000, according to manufacturer Cummings-Allison.
Higher-end models can count upward of 10,000 coins a minute.
Financial institutions typically generate a median coin intake from the machines of about $30,000 per month.
Bank costs include a $55 armored car pickup for each $5,000 in gross coin intake and $1,350 a year a preventative maintenance insurance agreement, according to Cummings-Allison.
The Massachusetts Bankers Association doesn’t keep track of which banks offer coin counting machines.
Bank of America doesn’t have machines, but tellers will take your change if you’re a bank customer, B of A spokesman T.J. Crawford said. Neither Citizens Bank nor Sovereign offer coin counting machines.
The state’s largest credit union, Digital Federal Credit Union, has coin counting machines at nine of its locations and its new branch in Lowell will have one when it opens in May, DCU spokesman John LaHair said.
“Members love them, especially kids. They come in very handy for children that are not only saving money, but also schools that have collected funds for different charitable purposes. We also see many professionals who receive tips stop in to cash in their change on a very regular basis,” LaHair said.
The service is free to DCU members but non-customers are whacked with a hefty 10 percent fee, a bit more than Coinstar, which charges customers 9.8 cents on the dollar to dump change into their self-service green machines.
Coinstar machines number about 19,000 nationwide, are typically found in grocery stores, and are free if customers take their proceeds in the form of a gift card to retailers such as Amazon.com, J.C. Penney or Starbucks.
Lisa van der Pool of the Boston Business Journal can be seen weekdays at 6 a.m. on WBZ-TV.
You can follow Lisa on Twitter at @lvanderpool.