David Farmer collects a lot of coins. They just aren't his to keep.
The ORNL Federal Credit Union CEO has five Coinstar coin counting machines in branches and plans on buying four more to serve members and the public alike. Farmer said Coinstar machines alleviate a substantial burden for CU employees and provides a service to members, plus the possibility of cross sales and new members.
"They are fully serviced. Our employees don't have to lift bags, it takes out that physical aspect to it," Farmer said. "To me it's a win-win."
With 100,000 members spread out over 16 counties, ORNL FCU was literally dealing with a ton of loose change. Members had to collect their change into rolls and label each one with their account number and CU staff had to handle the load. Farmer said ORNL FCU absorbs the cost of the machines to provide a free service to members saying the time and physical effort saved by CU employees of not counting, lifting or carrying thousands of coins makes up the difference.
Bellevue, Wash.-based Coinstar is making a new push into the world of financial institutions this year. With 60 patents to its name for sorting and cleaning coins, $460-million Coinstar presently has 13,000 machines located in retail outlets worldwide, usually supermarkets. Coinstar SVP Alex Camara said Coinstar estimates that Americans have $10.5 billion sitting idle at home. Camara said in 2006 roughly 40 CUs have "gone live" with Coinstar machines that count 600 coins per minute.
"We're very keen to work with credit unions," Camara said.
Each machine weighs 700 pounds, has a 5.0-amps power requirement and stands 84 inches tall, 36 inches wide and 32 inches deep. Members feed loose change into the machine that separates and counts the coins. The coins are sent into two bins that hold around $3,000 coins each, depending on the mix. A voucher with the final count is printed out and members then hand it to a teller for cash or a deposit. Camara said the Coinstar machines are turnkey operations, with no up-front costs and full service by Coinstar field representatives. Financial institutions that own their own coin counters also have to deal with the resulting mass of coins plus storage. Camara said each machine is part of a network that reports counts, totals and operating status to Coinstar.
"This model we have is cheaper (for CUs) than doing it themselves," he said. "We often know a machine is down before they do."
Camara said CUs can cross sell their products and services as members turn in their vouchers for cash. Camara has also noticed an increase in the number of small business owners counting their loose change in financial institutions. As most CUs are allowing the public to count coins, the Coinstar machines also serve as a destination point for potential members, he said. Camara also said the coin machines have succeeded in credit unions as members tend to visit more often than other types of financial institutions.
"They tend to become fairly repeat customers," he said.
ORNL FCU CEO's Farmer said the machines haven't disrupted branch foot traffic. One of his machines is in a small room that members like as it offers a bit of privacy while counting their change and helps to reduce the noise level.
"That seems to work real well," he said.
ORNL FCU was formed in 1948 with 10 members each pitching in $5 to serve the employees of Oak Ridge National Laboratories which were part of the federal government's Manhattan Project to build an atomic bomb in World War II. ORNL FCU now has $890 million in assets. Camara said Coinstar is actively planning new products and services geared toward financial institutions and will make further announcements throughout the year.
