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Going cardless at the ATM catches on

Matt Hamblen | July 25, 2016
Banks are rolling out NFC and other tech at ATMs to work with smartphones

wells fargo

Several major banks in the U.S. now support the use of a smartphone to withdraw cash from an ATM -- many by way of Near Field Communication (NFC) technology -- instead of requiring customers to use a bank card.

One of the early adopters, Bank of America, said this week it currently supports cardless technology at 2,800 of its ATMs. That number will reach 8,000 ATMs by year's end that rely on NFC and other technology. Bank of America, which has about 15,000 ATMs nationwide, created a video to show how a smartphone loaded with the bank’s mobile app can now withdraw cash from some ATMs.

Wells Fargo said it has a "handful" of ATMs that are NFC-ready and working to deliver cash and other transactions and is planning to reach 5,000 by the end of 2016. A total of 12,000 ATMs will be enabled in 2017.

JPMorgan Chase said it also will have many cardless ATMs available this year, but didn't specify how many or when. Initially at Chase, customers will show up at an ATM and type in a numerical code they acquired wirelessly through use of the Chase smartphone app to get their cash. That numerical code verification process will be an early step in rolling out cardless technology at the bank's nearly 15,000 ATMs.

In addition to using NFC or a numerical code to authenticate a transaction, some bank ATMs are expected to rely on scanning a QR code displayed on a phone.

The number of ATMs supporting cardless cash remains a small portion of the estimated 500,000 ATMs in the U.S. Crone Consulting, which monitors the mobile payment industry, recently said it expects about 95,000 ATMs in the U.S. to support cardless cash by year's end.

The growth in cardless cash at ATMs is ironic, given that mobile payment technology is designed more for payments at stores, on trains and other locations with a quick swipe of a phone and without the need for cash.

But bank officials said there is still a strong interest in cash, especially in the U.S. "People still use cash and we don't see that going away or lessening," Jim Smith, head of virtual channels at Wells Fargo, said in an interview.

Banks and analysts admit that mobile payments have been slow to catch on in the U.S. However, banks see cardless cash at ATMs as another way to accommodate consumers who use their smartphones repeatedly every day for a variety of tasks.

"Consumers are living a large part of their lives with their phones right alongside them, so it's really critical to continue to help them do their banking that way," said Paul Hartwick, a spokesman for Chase. "In the past, banks looked at each other for deciding what's next and now we are looking at things like Uber and other experiences that people are used to having on their devices. People are not judging us against other banks, but based on all the apps on their devices."


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