SunTrust Banks (STI) is bracing its ATMs for the future. It's throwing out its dual-slot ATMs — old-school machines with separate slots for depositing checks and cash — and replacing them with modern models that will be able to work with mobile devices.
The bank is migrating all the ATMs in its 1,700 branches to single-slot mixed-media NCR (NCR) ATMs, a project that is expected to be completed by December. The refresh will also allow the machines to communicate with near-field-communication-enabled smartphones and to accommodate international chip and PIN security protocols.
Tom McDermott, senior vice president of cross channel strategy for the $178 billion-asset SunTrust, says internal customer research that found about 80% of consumers preferred the single-slot ATMs because they're easier to use. The Atlanta company is still planning strategy for its nonbranch ATMs, but it is likely all ATMs will be migrated to single-slot, save for a few machines that only dispense cash, mostly on college campuses.
Single-slot ATMs allow deposits, withdrawals, and a mix of cash and checks to be deposited through the same slot with no envelopes. The machines present users with images of all the deposited material. They have also been a point of contention over reliability, though SunTrust, and other banks that have deployed single-slot ATMs such as Wells Fargo (WFC) and BMO (BMO), have not reported downtime issues.
SunTrust's broader strategy includes using smartphones as an authentication device and outfitting ATMs to comply with Europay, MasterCard and Visa (EMV), a global card security standard that uses embedded chips as a means of authentication and execution instead of magnetic stripes. EMV technology, which is considered safer than mag stripes, has been used extensively in Europe and is presently coming to the U.S.
"We'll be able to knock out two or three things at the same time, such as chip and PIN, and mobile," McDermott says. Improved access to ATM as part of Americans with Disabilities Act compliance is also part of the plan, he says.
McDermott says mobile authentication, in which people wave a mobile phone near a bar-code reader on the ATM to identify themselves, has proven a popular method to access ATMs in Asia, and SunTrust will soon embark on a project to retrofit ATMs to accept mobile authentication as an option. Mobile authentication is reliant on smartphones outfitted with near-field communication technology, which isn't expected to be widely available on new smartphones for a year or so. McDermott acknowledges that but says the uptake should be fast once NFC phones enter the market.
"You'll see a rapid adoption of NFC and mobile payments at that time," he says.
McDermott says single-slot ATMs introduce convenience. "The benefit is single-slot ATMs are easier, it's logically easier to use one slot," he says.
Using mobile devices to authenticate ATM transactions can improve security, McDermott says. "If you can authenticate without a card, you can cut down in card skimming," he says, referring to the practice of lifting numbers off of plastic cards.
Single-slot ATMs have been a battle ground among ATM providers, particularly NCR and Diebold (DBD). Bob Tramontano, vice president of marketing for NCR, says the machines can play a role in moving complex mixes of deposits and withdrawals away from the teller line.
"The consumer has greater control, and the banks can reduce queues at the teller line," he says.
The easier-to-use single-slot ATMs can also help drive other self-service innovation, such as using mobile devices at ATMs and other kiosks, and video tellers that link to remote service staff, Tramontano says.
Mike Shirk, a strategic marketing and product management specialist at Diebold, says the company is sticking to dual-slot ATMs for now. "Our solution today remains based on separate cash and check modules," he says. "When you look at availability, it's how many transactions you can accept more than the number of slots."
Shirk does not rule out a move to a single-slot machine.