A new mobile money ATM solution from Wincor Nixdorf offers a possible answer to two business questions that banks have begun to wrestle with: how to get more functionality out of their ATM networks, and how to enable transactions via the mobile phone.
In partnership with Swisscom-owned Sicap, in February Wincor Nixdorf unveiled a new type of ATM designed for a range of mobile money services, including cash-in/cash-out transfer. Wincor Nixdorf manufactures the ATMs and their server-based software, while Sicap architects and implements the service to the operatorenvironments.
“It’s pretty slick,” says Wesley Wilhelm, a senior analyst at Aite Group. “It’s leveraging the ATM’s ability to take in cash, do accounting and counterfeit detection…and potentially enabling a lot of functionality.”
As Sicap’s involvement suggests, the solution is aimed primarily at convincing mobile operators in places such as Europe and Africa, where mobile payments are already widespread, to build their own ATM networks to offer payment services. But the solution has potential applications for banks, which instead of building out an ATM network to offer the mobile money services could use their existing ATMs, says Hermann Salmen, project manager for the telecom industry approach at Wincor Nixdorf. Wincor Nixdorf is in talks with U.S. clients to pilot the solution, Salmen says.
For cash remittances via these ATMs a sender simply enters the phone number of the recipient and a security PIN on the ATM touch screen and inserts the amount into the ATM. The recipient can withdraw the actual cash from any participating ATM. Or a bank customer could send the payment instructions via a mobile phone, allowing the recipient to pick up the cash at the ATM.
Nicole Sturgill, a research director at TowerGroup, says that using the ATM network this way creates possibilities but it demands a change of mindset. “We think of ATMs as being tied to bank accounts, end of story. But it doesn’t have to be that way.”
Sources agree that several factors will slow U.S. adoption of these kinds of mobile money solutions. The regulatory environment for one, says Salmen. Banks worry they will run afoul of know-your-customer and anti-money laundering rules. Sturgill argues banks can put adequate safeguards in place to comply with KYC and AML rules. Yet, she agrees the adoption of this kind of technology is several years out, in part because U.S. consumers aren’t demanding it. Demand for these kinds of services will grow as people in the U.S. become more accustomed to using their mobile phones for payments, Sturgill says, “but that’s a couple years out.”
