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ISOs don't see eye-to-eye on ADA

While the ADA has become an issue of great and immediate concern for banks, ISOs attending the ATMIA West conference had mixed ideas about its importance.

October 10, 2001

LAS VEGAS - Bill Jackson referred to the impending ADA regulations for ATMs as a "sleeping giant," that will affect everyone in the ATM industry during a presentation at ATMIA's 2001 Conference West.

Triton Systems Inc.'schief technology officer, a member of a select group of ATM executives who have held meetings with blind advocacy groups this year, told a group comprised mainly of representatives of ISOs that it is difficult to prepare for new accessibility rules expected to be approved by the Department of Justice next year.

"Nobody really knows what's going to happen," he said. "My advice is to show you are making an effort to implement a compliance program, so you can at least show you're trying."

Key issues for ISOs include the potential requirements for retrofitting existing machines, and the potential for what he called "drive-by" lawsuits brought by attorneys who may target ATM deployers in hopes of getting quick settlements.

Referring to information released byBank of Americaat last week's ATM Conference in New Orleans, Jackson said the cost for upgrading existing ATMs to become "talking ATMs" won't approach the $4,000 per machine the bank is spending. He said that Triton has received only a small number of requests from ISOs on the issue, and hasn't yet delivered a final price for upgrades.

While banks have certainly taken the lead in responding to the potential new regulations, which could be finalized and approved by the Justice Department in less than a year, few ISOs have made proactive responses to the issue. Several banks have begun programs to retrofit ATMs with software and hardware to make their ATMs compliant, while most ISOs are either taking a wait-and-see approach or are ignoring the issue.

"My opinion is we're overreacting to the ADA regulations, and we need to take a look at lobbying to repeal some of the regulations. I think cooler heads will prevail and it won't pass," said Bruce Kreeger, president and CEO ofATM Center Inc. referring to a possible clause that would require ATM deployers to retrofit their currently installed machines in order to make them comply with any new requirements.

Kreeger said he couldn't imagine a scenario in which blind people would be regular users of the ATMs typically deployed by ISOs at locations such as convenience stores and gas stations. Statistics released last week by Bank of America showed that existing talking ATMs have generated fewer than two transactions per month.

Jackson, however, pointed out that the fact that there is no business case for upgrading ATMs won't matter when the regulations are handed down.

Saul Caprio, director of marketing for E-Trade Access, is the only ISO representative in the group of ATM executives organized by the American Bankers Association to address the issue with blind advocacy groups. With ATMs placed in several large retail outlets, he believes E-Trade could become a natural target for lawsuits brought by advocates of the sight-impaired.

"We're totally committed to doing what it takes," he said. "We're just waiting for the final regulations to see what we need to do and what role the merchants will have to play. We're determined our ATMs at major retailers will be made compatible whether they're required to or not."

Some suspect that the most likely scenario will be that new ATMs will be required by some future date to be able to talk, and that existing machines will be spared from the new requirements. That could be a selling advantage to manufacturers and ISOs who are first in line with machines that comply with the new rules.

TJ Hannon, vice president of marketing forHanco Systems, said his company has been working with its manufacturers to be prepared.

"It's something you'll be able to sell to your customers. From that standpoint, it can be an advantage, especially if you've got it and your competitor doesn't," he said.

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ATM Industry Association (ATMIA)

The ATM Industry Association, founded in 1997, is a global non-profit trade association with over 10,500 members in 65 countries. The membership base covers the full range of this worldwide industry comprising over 2.2 million installed ATMs.

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Triton Systems

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