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What the future holds for ATMs, mobile, the branch and cash

Want to know what the future will look like? Ask a futurist.

May 28, 2013 by Suzanne Cluckey — Owner, Suzanne Cluckey Communications

In a mature industry working to retain its vitality and relevance against a backdrop of high-speed technological change, it's good to have someone around who can sift through the speculation and hype to present a reasoned, thoughtful view about the direction of the ATM industry — and the larger financial services industry.

In Mike Lee, the ATM Industry actually has a bona fides futurist. In addition to being CEO of the ATM Industry Association, Lee is a member of the World Future Society, the International Society for the Study of Time, the Royal Institute of Philosophy, and the Institute of Physics.

Lee will also be a speaker at the first annual ATM & Mobile Executive Summit in Washington, D.C. on Sept. 25–26, where he will participate in a panel discussion, "What's a Bank to do with the Cashless Society?"

In advance of the summit, ATM Marketplace asked Lee about his expectations for the next several decades of the financial services industry. 

When it comes down to it, is a "cashless society" really anything more than wishful thinking by the card companies? Will we ever stop needing an instant, tangible and trusted means of economic exchange? 

I believe the cashless society is a propaganda myth manufactured by the card schemes who have an obvious vested interest in the demise of cash. Humans have a 27-century attachment to cash which is human-friendly so I don't see us breaking that dependence on this kind of tangible money for generations.

Long term, say over the next 100 years or so, what do you see as the place and importance of cash in societies — particularly in developed economies?

It's not easy to make forecasts 100 years ahead, although it is possible. The rise of women's rights, for example, was predicted just under 100 years before it happened by a thinker during the French Revolution by the name of Condorcet.

My own view is that as long as there is money, there will always be cash because it is not possible to replicate all the properties of cash. Compared to a history of 27 centuries, another 100 years of cash is not so far-fetched as it sounds at first.

Even in developed nations, there will likely continue to be different demographic and social groups and classes, some of whom will continue to use cash. The chances of there being such widespread public trust of organizations providing alternatives to cash as to allow for the total replacement of cash throughout society seem to be close to zero.

As cash use decreases and mobile banking gains greater momentum, what will become of the bank branch? 

Bank branches are becoming more and more automated and the rise of customer-owned devices working together so well with self-service banking technology, including video banking, prompts me to believe we will one day see total automation of banking in the far future, and the demise of the staffed branch.

How will cash, plastic and mobile technologies eventually converge and integrate? 

They will co-exist and synergize and retain their distinct niche customer markets. I see very good global potential for synergy between mobile banking and ATMs.

One of the biggest "threats," if you will, to cash seems to be the trend toward contactless card and mobile technologies that enable small purchases with just the wave of a card — no PIN or signature required. Will this type of technology ultimately replace cash for small purchases?

 That did not happen in Kenya despite the exponential growth of the MPesa program, because cash demand and cash in circulation continued to expand in the country during the years of rapid adoption of MPesa as central bank statistics show. To my mind, contactless technologies are a bigger threat to the future of plastic than to hard cash.

There's been a lot of talk about Bitcoin (and especially, lately, the Bitcoin ATM) and the prospect of a universal digital currency exchange. What do you think of the concept? 

Virtual currencies like this are very interesting and doable. But you have to understand that digital is a copy of analog, not the other way around. Humans and cash are analog — they come first. We only embrace digital for convenience but we will never be ready to abandon analog technologies which are high-touch and human friendly.

Is there such a thing as a digital jewelry? No — we want the real thing that we can touch and hold. It's the same with BitCoin and cash. The two go together, linked by the human customer. That's why PayPal and ukash are so interested in ATMs.

Read more about trends and statistics.

photo: evansg

About Suzanne Cluckey

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Suzanne’s editorial career has spanned three decades and encompassed all B2B and B2C communications formats. Her award-winning work has appeared in trade and consumer media in the United States and internationally.

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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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