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article imageATM's are 50-years-old — What does the future hold for ATMs?

By Karen Graham     Sep 24, 2017 in Technology
The automated teller machine (ATM) was considered a radical move when Barclay's installed the machines in a London suburb in 1967. At that time, the machines gave a fixed amount of money using a special voucher - The familiar ATM card wasn't invented yet.
The whole process in 1967 is archaic by today's standards. A customer could not transfer money between accounts and an actual bank employee had to tabulate all the transactions manually at the end of the day.
Over the years, as technologies have advanced, the ubiquitous ATM has changed the way banking is done around the world, not only changing the banking industry but changing the way consumers interact with machines that replaced humans.
We became so comfortable interacting with the ATM that we now think nothing of getting movie tickets and boarding passes, doing self-checkout at grocery stores, and shopping online for products, all brought to our door after a few clicks. This shows we can handle basic transactions without any help from tellers or cashiers.
"The ATM tapped into that innate force in people that gives gratification for doing a task on their own and it grew from there," said Charles Kane, a professor at the MIT Sloan School of Management.
A bank in London marked the ATM's first half-century by giving a gold makeover and a roped-off ...
A bank in London marked the ATM's first half-century by giving a gold makeover and a roped-off red carpet to the site where the very first cash machine was installed
ATMs today have a lot of competition
For years, ATMs were a boon to banks because they could spread their services, being in thousands of places at once, not just in branches. It also meant they made billions of dollars in fees from non-customers. Banks also didn't need to staff as many tellers in their branches to handle customer transactions.
Today, there are over three million cash machines in the U.S., alone. However, most of them are owned by private companies out to make a profit. The machines are installed in convenience stores, restaurants, and bars in hopes of grabbing customers who don’t want to find a bank branch.
Funny thing is, ATMs are still fairly popular, even though most financial transactions are now done using online and mobile applications. However, its security has remained largely unchanged since 1967. And this could become a problem because most ATM cards are also debit cards. Even with this, customers actually want more from ATMs.
Sign for an ATM machine
Sign for an ATM machine
YouGov survey on ATMs
ACI Worldwide commissioned a YouGov poll of 8,000 people around the world and learned they are largely content with ATMs. While ATMs are used primarily to check balances and get cash, ACI reported consumers in the poll wanted to see " more detailed information about their account, such as mini-statements, alerts for upcoming payments or overdraft fees, the ability to dispense a new credit or debit card or to access electronically signed official documents."
This photo taken on June 27  2017 shows a woman making purchases through her smartphone at a shop in...
This photo taken on June 27, 2017 shows a woman making purchases through her smartphone at a shop in Beijing
Of course, all these benefits are already available if a customer goes online to his bank account. And this is one of the biggest drawbacks to adding additional services to an ATM. The cash machines are bumping into our mobile phones, particularly when it comes to getting account balances, check deposits and person to person (P2P) payments.
And even though ATMs can be used for real-time bill payments, one problem with paying a bill through an ATM is that, despite banks’ efforts to become a central part of their customers’ financial lives, most people pay through the biller’s website, and not the bank’s.
“Our data shows significant bright spots in the shift toward electronic bill pay, including the 72 percent of online bill payments are made on billers’ websites,” said Sheri Chin, vice president, ACI Worldwide. However, ACI also notes that we are not a "cashless society" yet. In Germany, 48 percent of respondents said they still use ATMs for cash, while in the U.S., the figure is 34 percent.
More about Atm, 50th anniversary, financial innovation, Security, Biometrics
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