Cardless ATMs Come of Age

A JPMorgan Chase cardless ATM in N.Y.C

By Anna Breuer on 18 June 2018
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In a world where contactless payment seemed like something out of a Jules Verne story until Apple Pay and Google Pay came along, banks are now on the edge of what could be a major revolution in how we interact with them, at least at the branch level.

The change: automated teller machines that don’t require an ATM card for such tasks as deposits, checking balances, transfers, and cash withdrawals. This is known as cardless ATM access.

Unless you’re in Sweden, the most cashless society in the world, where signs saying “Vi hanterar ej kontater” (“No cash payments in this store”) abound, cash will be around for a long time. It provides people with financial security and peace of mind as there are still millions who don’t want to use cards or other cashless technology and some establishments only accept cash.

With the exception perhaps of Sweden, access to cash is still a necessity and the majority of the world is a long way from going completely cashless.

One of the problems with cash, of course, is that getting it typically requires going to a bank, and most people get cash from an ATM, or automated teller machine. The first such machine went into service on June 27, 1967 at a Barclays Bank branch in London, beating the competition – a Swedish machine known as a Bankomat – by a mere nine days.

CASHLESS ATMS ADDRESS MULTIPLE SECURITY ISSUES

One of the main benefits of cardless access at an ATM is improved security. Users don’t have to worry about losing their ATM cards.

Using a mobile wallet for ATM access also means the user isn’t pulling out his wallet at an ATM, which could be misplaced or stolen (although it’s unclear how banks will address the issue of after-hours access). Additionally, using cardless access defeats skimming – a process whereby hackers use devices installed on an ATM that can intercept banking details thus enabling unauthorized access of an account – because the ATM card data is transferred wirelessly.

It’s also important to note that using a mobile wallet such as Apple Pay is more secure when making purchases than using a credit card, even an EMV or chip-and-PIN or chip-and-signature credit card. For example, Apple Pay keeps an individual’s credit card (or debit card) information private and replaces the credit or debit card number with a tokenized Device Account Number while it creates a dynamic unique security code that it generates for each transaction.

Click here to continue to Page 2Banks Roll Out New Cardless ATM Functionality

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