The ATM-and-mobile age is here. Where are you?

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Editor’s note: The following is an excerpt from “ATM and Mobile 101,” a new report by ATM Marketplace and Mobile Payments Today contributing writer Robin Arnfield. The report was published by ATM Marketplace and sponsored by FIS, and is available free of charge for download from this website

The mobile phone has evolved from a tool used primarily for voice communications into a rich channel for data exchange and consumer interaction. The convergence of mobile communications with self-service means that mobile devices are becoming ATM access devices, able to offer many of the display and keyboard functions currently available on ATMs.

This report provides guidance for ATM deployers considering the integration of their ATM and mobile channels.

Mobile-ATM integration means that a financial institution’s customers can use a smartphone to withdraw cash from ATMs without a debit card, and also use mobile devices to personalize their experience at the ATM.

This report examines the various methods used for mobile cash access: QR codes generated by a mobile banking wallet; NFC-based contactless transactions that use card data stored in a smartphone-linked mobile wallet; and onetime PINs generated by a mobile app. It also looks at the security issues associated with cardless cash access.


Allowing customers to prestage ATM withdrawals on a smartphone offers a number of benefits, including:

  • the elimination of card skimming;
  • the provision of an extra layer of authentication;
  • time-savings — prestaged transactions can cut ATM session times by one-half or more;
  • increased loyalty among customers who appreciate having the ability to use a mobile device to personalize their ATM transaction menu;
  • ATM locator apps that allow customers to use the GPS technology in a smartphone to find (and get directions to) nearby ATMs — including surcharge-free machines;
  • a new revenue opportunity — an FI can sell space on the back of the customer receipt, allowing nearby merchants to extend location-based offers to a nearby ATM user;
  • service for un- and underbanked consumers who can use their smartphone to withdraw cash from a mobile wallet or other prepaid account;
  • an attractive feature for younger consumers who want to use their smartphone in all areas of their life.

“Most FIs who are considering deployment of mobile cash access technology are looking at it because they want to be able to differentiate their service offerings from rival banks,” said Doug Hartung, Diebold Inc. director of global software research and strategy. “For example, if a bank only allows its own customers to use their smartphones to withdraw cash from its ATMs, as opposed to allowing non-on-us/off-us mobile ATM access, this could provide an interesting marketing opportunity. The bank could say in its promotional literature: ‘if you bank with us, you will be able to access our ATMs from your smartphone.’”

Providing mobile cash access allows smaller financial institutions to compete with larger banks that have yet to deploy the technology. “In the U.S., smaller banks are interested in deploying ATM-mobile cash access technology, as they see this as a way to make things more convenient

for their customers,” says Lian Zerafa, a partner in the KPMG Canada Financial Services practice.

Mobile-first consumers

By offering mobile cash access at their ATMs, FIs can appeal to today’s smartphone-savvy consumers who want to use mobile devices in all aspects of their life — including financial transactions.

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“Smartphones are quickly becoming the singular device that people use to help manage their life,” Connie Stefankiewicz, BMO Financial Group head of North American Channel Strategy and Solutions, said in a statement.

“An increasing range of service industries are moving to mobile,” Shelli Bernard, an analyst at ABI Research, says. “This overall shift means that those companies which aren’t able to support mobile will likely be left behind, and the banking industry is no different.”

According to “The Rise of the Mobile First Consumer — and What that Means for Banking,” a report by Javelin Strategy & Research, “mobile-first” U.S. consumers — i.e., those who primarily use a mobile device for access to a checking account at their primary bank — now number almost 1 in 4 (23 percent).

By comparison, U.S. mobile users who named the ATM as their primary point of access represented 1 in 10 of all respondents, the Javelin study says.

Mobile-first consumers are by no means mobile-only consumers. Javelin found that they also demonstrate high rates of online, mobile and ATM use, and average rates of branch use.

Mobile-first consumers prefer giant banks, are fee sensitive and are more likely to switch banks within the next 12 months. Capturing these consumers will involve rethinking customers’ mobile experiences from start to finish, Javelin says.

Customer adoption

Mobile cash access should be seen as part of a move by FIs to enable their customers to replace their plastic credit and debit cards with mobile wallets that can be used for face-to-face and remote payments. However, the move to cardless ATM transactions will be gradual.

“There is going to be a transition period with mobile payments,” said Diebold’s Hartung. “We’re a long way from consumers leaving their wallet behind when they go out and doing everything on their mobile. For example, government ID isn’t legally accepted yet on smartphones.”

Hartung said that for a mobile cash access deployment to be successful it needs to be easily understood by consumers, easily deployed at ATMs, and frictionless in operation. “As with other new technologies, FIs deploying mobile cash access need to create value for the consumer,” he said.

Download the free report

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