Many people use their phone or other mobile platforms these days to order take-out meals, hail a ride and buy movie tickets. Throw in how annoying those chip credit and ATM cards can be and people are looking for more ways to not have to pull out their plastic. The banks have heard. Several larger U.S. banks will soon let customers pull out cash using their smartphone or mobile device access instead of a card at ATMs in the coming months. Some will even access Apple Pay and Google’s Android Pay mobile wallet.
Cash machines that work with a phone have been introduced before, but on a very limited basis. A bank in Los Angeles unveiled a cardless ATM almost three years ago and some regional banks elsewhere in the country did too. But, their presence was so limited that they did not catch on.
Now, however, several large national financial institutions are rolling out ATMs that will enable customer transactions and cash withdrawals via smartphone. Bank of America, Wells Fargo and JP Morgan Chase have all announced that they will be employing the capability in many cities starting in the next couple of months. (Between them, they have 47,000 ATMs nationwide, so a major change is a large undertaking.)
The smartphone access to ATMs uses two different technologies, depending on the bank. The first, which Wells Fargo and Bank of America plan to deploy, uses near-field communication (NFC), which is the tap-to-pay technology used by Apple Pay and competitors. Using near-field communication, a customer signs into the bank’s app on the phone, then physically taps the phone on the ATM and enters the appropriate PIN.
The NFC technology has to be built into the machines. So, only those with signs indicating that they have NFC readers will be enabled. Bank of America has the technology in half of its ATMs already and will unveil it in parts of California; Boston; Charlotte, N.C.; and New York in the next month. Wells Fargo expects to have the technology in one-third of their ATMs by year-end. Some of Wells’ ATMs already support Android Pay.
Chase is also planning to implement an NFC system. But, their rollout this year will use a code-based system that does not require new ATMs, just a software update to then. The code-based system requires customers to log into the bank’s app and get an access code for pulling out the cash. The code is for immediate use and will expire in minutes. The idea is to use the phone app while walking up to or waiting for the ATM. The one-time use and quick expiration time are designed to prevent misuse.
Using a phone to get a short-term code is considered to be more secure than using a debit card and PIN because the magnetic stripes have security problems. Getting the phone code requires signing into the bank or mobile wallet app, so someone would have to know the customer’s login, password and his or her bank PIN to get a code.
Chase is also planning to have more machines that dispense a variety of dollar bills instead of just $20 bills. They have slowly been adding these machines, particularly as they add more ATMs inside branches for people to use rather than interact with a teller.
While people can pay for most things with credit or debit cards, there are still places that require cash. Having the green stuff certainly comes in handy for giving a tip to a skycap for baggage handling, putting in container on the counter at the ice cream shop, saving money at the gas pump, and more. The smartphone ATM capabilities that are coming soon will add convenience for people and provide access to cash even when that debit card is at home and the customer is not.
Written and edited by Dyanne Weiss
Los Angeles Times: Big U.S. banks will be rolling out ATMs that take smartphones, not cards
CNBC: Chase planning rollout of card-free ATMs
Reuters: Wells Fargo, BofA look to integrate Apple Pay into ATMs: TechCrunch
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