The ATM Turns 50: Why Evolution Is Key For Its Survival

Monday, July 10, 2017

Posted by Katrin Boettger to Payments and Industry Trends, Transaction Banking

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The ATM turns 50 this year and half a century on ATMs remain popular with consumers worldwide. Banks and building societies more than ever see ATMs as a key channel of communication and interaction with their customers and many are now offering ATM services that go beyond simple cash withdrawal. We spoke with Paul Horlock, Director for Payments at Nationwide, one of the biggest high street financial providers in the UK.  Nationwide has been working with ACI Worldwide for over 30 years and currently uses ACI’s BASE24 eps solution to power an estate of around 700 ATMs across the UK. 

Paul, it is no secret that cash is on the decline in the UK and with the ATM known to many consumers simply as ‘cash point’ the question is: Do we still need ATMs and what for?   

It is certainly true that in the UK the use of cash is in decline, in fact over 50% of transactions in Britain are now cashless while digital and contactless payments are becoming more popular. Today most consumers have a ‘digital interface’ in their pockets to make payments or access other banking services. For ATMs that means -  evolve or die! Let’s remember what ‘ATM’ actually stands for -  Automated Teller Machine -  and it is exactly in this role that the ATM is going to be relevant for the next 50 years, offering a variety of services that consumers need and that can complement other existing channels.

What kind of services does Nationwide offer its customers via its ATMs and what role do ATMs play in the overall strategy of the business? 

In the last few years we have modernised our ATMs, a task that is ongoing, and today they are offering many services that go beyond the usual functions of dispensing cash and balance information.  Via our color touchscreen ATMs Nationwide members are for example able to deposit banknotes, which are immediately credited to the account and available for withdrawal. Customers can access mini-statements and receive service alerts or information about special offers. We have an in-branch only ATM estate at Nationwide and every time a customer interacts with one of our ATMs we enable them to have a conversation with their branch and us as a building society. Our aim is for customers to have a consistency of services and experience whether they are using an ATM, speak to one of our colleagues in branch or access services via their mobile or internet.

ACI published a global survey of 8,000 customers to celebrate the 50^th anniversary of the ATM which revealed that better and more secure ways of authentication are on top of consumers’ wish list when it comes to new ATM services. Are you looking at new ways of customer authentication for ATMs?  

Preventing fraud and making sure that our customers feel secure when using our ATMs is a priority for us. Like many others in the industry we are looking to develop new and secure methods of authentication. I think what we will eventually see are new authentication methods which involve a combination of identification via a mobile phone and biometric factors. We are working on this and looking at how to integrate this into our existing ATM services.