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ISOs test Amazon gift cards with Better ATM

October 8, 2008

Gary Wollenhaupt is a regular contributor to ATM Marketplace. To submit a comment about this article, pleasee-mail the editor.

Two independent sales organizations are now set to test distribution of $25 Amazon.com prepaid cards at about two dozen ATMs in theUnited States. The deal was announced this week from Source Media's ATM, Debit & Prepaid Forum inChandler,Ariz.

Mira Loma, Calif.-based Automated Cash Management Systems and Portland, Ore.-based APTUS Financial have signed deals with Better ATM Services Inc. to sell the Amazon cards with a bonus coupon from Restaurant.com worth $25. Dallas–based Columbus Data Services is providing transaction-processing services for the program, which charges consumers a convenience fee of between $2 and $3.

A program pilot is set to roll out in about two weeks at 25 locations scattered across different segments of the population, such as college campuses and professional centers. The pilot is expected to run through the end of the year.

The machines in the test will use on-screen promotions as well as signage to promote the Amazon.com and Restaurant.com prepaid cards. And getting the store staff involved can help consumers use the ATM option for purchasing gifts, rather than waiting in a long check-out line during the holidays for the same service.

Better ATM, based inMesa,Ariz., licenses the software and has already developed applications for ATMs from Diebold Inc., Triton Systems of Delaware Inc. and Wincor Nixdorf International AG. The company is now working to certify Nautilus Hyosung Inc. machines.

To dispense the cards, the ATM must be dual-cassette capable.

"Most major ATM manufacturers have models that lend themselves to issuing gift cards, and eventually we will have products for virtually every model," said Todd Nuttall, chief executive of Better ATM. "But right now, there are some limitations." 

Better ATM, an authorized Amazon.com reseller, expects to introduce its card-dispensing product to an international base of customers through ATMs — branching out from its previous base of only providing cards and coupons from local businesses. With Amazon.com, users can buy products from numerous places.

"The Amazon.com cards are a step up from closed-loop markets we served before, like restaurants," Nuttall said. "Now we're with a national (international) brand."

APTUS Financial said it found the offering appealing because it can serve users in high-volume metropolitan areas.

"You have to have more of a global product that's used by more than just one retailer," said Jeremy Inman, APTUS Financial's vice president of operations.

Nuttall expects most traffic to come during the holiday shopping season.

"This will make the ATMs at those high-traffic businesses and campuses one of the shopping destinations of choice — where consumers can go to an ATM and get a whole set of gift cards," Nuttall said.

Better ATM plans to expand its program to about 500 ATMs in 2009.

"Just like the ATM revolutionized how customers view banking, ATMs are revolutionizing the way gift cards will be sold," said Automated Cash Systems CEO Carl Stein "This is a labor- and-time saving convenience and a boost to the bottom line."

The gift card stock is loaded into the ATM at no cost to the operator, representing a revenue stream without the vault charges that come with cash.

"Prepaid cards reverse the economics of the ATM. Now operators have plastic cards sitting in their machines at no cost, and when they're dispensed, the operator gets paid," Nuttall said.

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