If people are getting more comfortable with automated teller machines, why are deposits decreasing as a proportion of total ATM transactions?

That's a tough one to answer. But judging from one set of data that appeared earlier this year in the Federal Reserve Bank of Richmond's quarterly Economic Review, that seems to be what has happened during the last two decades.

Deposits were 20% of all ATM transactions in 1975, but by 1991, they had declined to 10%, according to statistics collected by David Humphrey, a professor at Florida State University in Tallahassee. Withdrawals were 77% in 1975, and rose to 86% in 1991. Account transfers and bill payments were negligible in both years.

Humphrey, who previously was a staff economist for the Fed's Board of Governors, points out that the data may not be entirely reliable given that they were collected by different researchers using different methods. He says it's hard to draw any sound conclusions from them. But Kere Lewis, an executive vice president with Speer & Associates, an Atlanta consulting firm that periodically studies the ATM business, says the general trends appearing in Humphrey's study are sound.

The study belies the assertion that ATMs can soon become full-service banking machines, and it could indicate a lingering reluctance of the general public to use them for deposits.

Other reasons could explain the relatively small proportion of deposits, acknowledges Humphrey. One is that a growing number of people are paid via direct deposit, so there are fewer checks to deposit at ATMs. A second factor is that with ATMs being so widely available, people's behavior has changed. Customers now withdraw cash two or three times a week rather than once a week as was customary back when they had to deposit their paychecks in person.

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