In one of the largest automated teller machine deployments in recent memory, NCR Corp. will provide more than 1,100 ATMs for Kmart stores.
"We believe this is the biggest off-premises deal of the year," said NCRvice president Andrew Orent.
Half the machines will be installed by the end of October, the rest by yearend, Mr. Orent said. Customers will be surcharged for cash withdrawals, but they will be able to get postage stamps and coupons.
The last bulk order to Dayton, Ohio-based NCR came in July, when Sears, Roebuck and Co. and Banc One Corp. ordered 800 machines for Sears stores.
NCR is the vendor of point-of-sale terminals and data warehouses for K mart.
Several banks will participate in the Kmart network. Fleet Financial Group, Boston, will help deploy ATMs at more than 200 stores.
Fleet senior vice president Robert B. Hedges Jr. said the arrangement "represents an important source of growth beyond our traditional geographic franchise."
Alan Pohlman, an electronic banking consultant at Carmody & Bloom Inc., Ridgewood, N.J., said the ATM arrangement would help Kmart "control the distribution channel." But he said surcharging can be a risky business.
"Where you have retailers placing machines, now you have this perception of added consumer wrath being visited upon the retailer," Mr. Pohlman said.
The companies would not disclose financial terms, but NCR's ATMs cost between $10,000 and $18,000 each, and Mr. Orent said Kmart's would be priced somewhere in the middle. This means the deal would be worth about $15 million in hardware alone.