The ATM in a Cashless World

The End of Cash

As we wrote earlier this month, the shift from cash to digital payments has been a gradual process that exploded in the past year thanks to the roll out of contactless technology in travel cards, credit cards and phones. We’ve been paying with debit and credit cards for years, but the process of signing or entering a pin number has always meant it was slower than handing over cash for a handful of change. Eliminating everything but the swipe has changed the game.

But, will cash die out? Eventually? Perhaps. Soon? Nope. There’s still something about physical money that imbues with a sense of greater value, and trust barriers will still slow the rate of change as people cling to ‘real money’.

This does, in the short term, create a dilemma for the corporations that take care of our cash. As more and more people rely on apps and online banking, the demand for physical locations is reduced, but not completely eliminated. People may rarely visit their local bank, but the idea of not having one at all still feels strange and alienates customers who still prefer to do their banking face-to-face.

The New ATM

This is where ATMs come to the forefront. If we assume that cash will soon be a thing of the past, then you may wonder why ATMs won’t go with it, they basically exist to spew out cash and most of them seem to be run on technology from another age, many were still running Windows XP when Microsoft ended its support. But, they are also a great opportunity, because if they were replaced with something that offered far more flexibility and a greater range of services, they could bridge the gap between the physical bank and electronic payments.

In many countries ATMs do offer a variety of services, such as paying bills, paying for parking, buying concert tickets, but a new generation of machines could go even further, allowing you to choose the exact denomination of your withdrawal down to the penny and introducing fraud-busting features like fingerprint scanning.

Chase's new touchscreen ATMs

Chase have begun rolling out their new “EBKs” or Electronic Banking Kiosks and although they represent a small percentage of their current ATMs, they could eventually lead to redundancy both technological and human. Experimentation with video conferencing via ATMs has been kicking around for a few years now and Bank of America started rolling out their version of the service earlier this year. Is speaking into an ATM screen really that different from watching someone count your money through inches of bullet proof glass then drop it through a hatch?

More Banks, Less Humans

Some companies have successfully blended automated technology into physical stores, whether it be a self-service checkout or the capacity to use tablets to browse for more information or check stock levels and prices. Using automation could allow banks to focus on the services that don’t directly involve cash transactions – selling loans and mortgages or offering small business or personal budget advice to those who need it.

Removing humans from the process saves both money and space and could make it more feasible to go beyond installing ATMs in places like malls, supermarkets, campuses and hospitals and actually build mini-branches. They would require minimal upkeep and space, while still offering the majority of services and maintaining that physical connection between bank and customer.

The new Wells Fargo bank branch

About the Author:

Joe wrote about luxury asset trends for Borro Private Finance.