ATM 2.0: Breathing new life into the cash machine
by Andrew Martin, CEO, Retail Bank Consulting Group
Let me begin by explaining what ATM 2.0 is: Simply, it is an internet terminal on top of a glorified photocopier that happens to process somewhat more valuable paper or, in some countries, polymer.
The minute we mention "internet terminal," a world of potential functionality explodes — and this is exactly what the new ATM 2.0 is — a world of potential.
Now, let us get the secondary functionality of ATM 2.0 out of the way: ATM 2.0 can and sometimes will dispense cash to those in need.
ATM 2.0 also can accommodate simple balance inquiries, a service for users who do not have mobile banking and who do not know how much money they have available (i.e., my parents!)
Another key point here is that ATM 2.0 can connect with an electronic account to release funds. We know these accounts as card schemes, but we should not limit the definition to this with a new world of challenger banks and online tools coming to the fore.
So, now that that we have the mundane part out of the way, let me expand upon the true, unlimited potential of the new ATM 2.0.
The new device can be an in-store brand champion, allowing a retailer or bank to market services that can make the customer journey easier, simpler and more enjoyable.
ATM 2.0 can run videos, show advertising or explain the transaction process to those in need (again, my parents).
Say you want to push a new product. Where can you run in-store videos to promote it? Nowhere, unless you install new devices.
But ATM 2.0 is there already, so why not use it? The promotion can be location-specific or national, depending on advertiser requirements.
To support the video the advertiser can provide a QR code on the screen or a receipt that the customer can use at the POS to receive a discount.
In addition to the idle screen video, videos embedded in the transaction itself can be personalized for the user as identified by the PAN on an inserted card.
ATM 2.0 will read the PAN and, with some rules-based logic, can show an ad specific to that PAN.
For example a bank might win a customer away from a competitor by promoting their particular predefined strengths.
Say you want to offer users a discount. With ATM 2.0, you can achieve this in a number of ways: with advertising on the reverse of the receipt; with a tear-off strip on the front; or with vouchers or coupons dispensed from the device.
This allows the retailer or bank to provide real-time discounts to the user, building customer loyalty.
Additional marketing options might include toppers that provide real-time advertising, or dynamic marketing aligned to the time of the day. Businesspeople during morning or evening rush hour; kids after school; moms out for a midmorning coffee — all of these segments can receive different messages.
The "headless ATM" — which allows the user to prestage transactions on a smartphone and then fulfill or authorize them at the ATM — is not that far away.
In practical terms, I see immediate cardless transactions as:
- emergency cash;
- money transfer; and
- click and collect.
Emergency cash we all know about; money transfer is a similar function in which transfers can be prestaged on a smartphone and fulfilled at the ATM.
Click and collect could refer to a transaction in which users order foreign currency online, receive a unique PIN on their mobile phone and go to the nominated ATM 2.0 to receive the cash.
All of these are cardless transactions wherein the smartphone essentially replaces the card — and eventually, even the ATM screen itself.
The functionality is unlimited and purely down to your imagination.
Loyalty program manager
ATM 2.0 can become a connection point to a loyalty program. The more the program member uses the ATM, the more points he or she gains.
ATM 2.0 can also be a way for the user to convert points to cash, or transfer points to someone else.
Loyalty is key and, again, can be linked to the PAN, allowing users not only to accumulate points, but also to redeem them.
Points redemption center
Here again, ATM 2.0 interacts with online systems, allowing the user to redeem, transfer or manage value at the ATM.
A few possible transactions could include:
- redemption of online gambling winnings or account top-up;
- withdrawal of funds held in accounts with Samsung Pay, Apple Pay or PayPal; and
- withdrawal of funds held with a challenger bank.
Redemption can be extended to other banking functionality, as well. So ATM 2.0 becomes the physical channel for challenger and online banks — without the need for bricks and mortar.
Data treasure trove
These new functions bring enhanced income through the ATM 2.0 channel. They also bring immense in-store benefits that can far outweigh the benefits of the traditional ATM.
And let me remind you of the huge side benefit of all these functionalities: data.
The ATM 2.0 operator becomes the proud owner of a bucket of data that identifies trends, buying habits, and more among ATM 2.0 users — all of which will grow and evolve with the ATM provider and estate over time, becoming a huge asset for the business.
How do we bring all this new functionality to ATM 2.0?
That is the simple piece. It is all achieved through application program interface-based technology, so all the service provider must do is to connect to the intelligent services gateway API, which in turn connects to the acquirer for the ATM network.
ATM 2.0 is here. ATM 2.0 is now. Long live ATM 2.0!