Cardtronics Inc.’s agreement to deploy ATMs aboard five Carnival Cruise Line ships signals Carnival wants more control of the lucrative shipboard ATM business in which cardholders pay surcharge fees as high as $5 per cash withdrawal, says a Cardtronics rival.
Cardtronics and Carnival announced their multiyear agreement Monday.
Cardtronics took some of Carnival’s ATM business from BankAtlantic, a Ft. Lauderdale, Fla.-based bank. BankAtlantic has deployed BankAtlantic-branded ATMs on Carnival ships and ships operated by four other cruise lines, including Celebrity, Princess, Royal Caribbean and Cunard,¬ since the late 1990s, says Lloyd DeVaux, the bank’s chief operating officer. “We have 160 ATMs, or two ATMs each, on the ships,” DeVaux says.
At one time, BankAtlantic deployed ATMs on Carnival’s entire fleet of 22 ships, but Carnival’s agreement with Cardtronics reduces the number to 17. “Our contract [with Carnival] did not expire,” DeVaux says. “[Carnival has] the right to take away or add ships any time.”
Carnival’s agreement with Cardtronics means Carnival wants a larger share of ATM revenues, says DeVaux. “Cardtronics will not brand the ATMs, so Carnival will receive a larger share of revenues. But Carnival’s expenses also will be higher,” he says.
Deploying ATMs aboard cruise ships is a lucrative business, DeVaux says. “It’s better than the general ATM business, which is a commodity business,” he says. “In premier cruise ship locations, ATMs charge cardholders surcharge fees of $3.50, $4 and sometimes $5 per cash withdrawal.”
BankAtlantic does not charge its own cardholders a surcharge fee if they are passengers on one of the cruise ships in which the bank operates its own ATMs, DeVaux says.
BankAtlantic and Cardtronics rely on ships’ satellite communication systems to process and monitor ATM transactions. BankAtlantic contracts with armored car companies in various ports to deposit funds into its shipboard ATMs, DeVaux says. Cardtronics declined to discuss how it would replenish its shipboard ATMs, citing security.
The Houston-based ATM independent sales organization has deployed two NCR Corp. cash-dispensing ATMs each on the Carnival ships, which include the Conquest, Inspiration, Paradise, Pride and Valor, according to Vance Gulliksen, a spokesperson for Miami-based Carnival. The ships carry 2,052 to 3,646 passengers, he says. Such capacities could provide an opportunity for Cardtronics to process large numbers of cash withdrawals. Cardtronics also will monitor and maintain the machines and provide customer service.
Although Carnival operates cashless ships in which passengers’ fares include all meals, snacks, drinks, admission to shows and exercise gyms, passengers need funds when the ships dock in ports during three- to 15-day cruises and to pay for retail purchases in ships’ large shopping malls. Passengers also need funds to gamble in ship casinos. Carnival ships sail to The Bahamas, Caribbean, the Mexican Rivera, Alaska, Hawaii, Panama Canal, Canada, New England and Europe.
“Customers appreciate easy and convenient access to an ATM while on vacation, and it is important that the ATMs on our ships be highly reliable and capable of serving our guests anywhere in the world,” Marie McKenzie, Carnival vice president of fleet accounting, said in a statement.
