Attendees of the ATM Industry Association show in Miami last week crowded around an ATM some believe could revitalize ISOs that sell ATMs and are suffering from shrinking margins and a lack of new ideas to generate revenue.
“If something is hot, people gather,” says Mark Smith, business manager for Triton Systems of Delaware, a Long Beach, Miss.-based ATM manufacturer that sells ATMs to ISOs.
Smith raved about an ATM competitor Nautilus Hyosung America Inc. has that also sells lottery tickets. The Monimax 5000 CE machine, which holds of up to 6,000 bank notes, sells Quick Pick Lotto tickets for the Mega Millions and Powerball lotteries. The Monimax 5300CE and Monimax 1800CE models also sell lottery tickets. Nautilus Hyosung America, which is based in Coppell, Texas, unveiled the machines at the conference.
Forty-two states sell Mega Millions and Powerball lottery tickets. Combined sales account for 43% of the $53 billion in lottery tickets sold annually, says Daniel Cage, CEO of Linq 3, a New York-based company and writer of the lottery-ticket dispensing software that runs on the Microsoft Windows operating system.
Linq 3 wrote the software in collaboration with Nautilus Hyosung America in anticipation of the merger between the Mega Millions and Powerball lotteries, the nation’s two largest. Thirty states sell Powerball lottery tickets, and 12 sell Mega Millions lottery tickets. Until recently, no state sold both. Powerball and Mega Millions, however, merged in Maryland, Virginia and Washington D.C. Cage expects other states to follow.
Officials in each state must approve the Monimax machines. “We are working with state lottery officials and operators, companies that run the games and print lottery tickets, to gain their approval,” Cage says.
Chan Park, Nautilus Hyosung America president and CEO, says selling lottery tickets is another value-added ATM service to add to check-cashing, bill pay and cash withdrawals. “We hope to have the ATMs in operation in the second quarter,” Park says.
During a demonstration at the show, the ATM asked Cage if he wanted to withdraw cash or buy five, 10 or 20 lottery tickets. Cage purchased 10 lottery tickets, and the machine printed them on a receipt. When purchasing lottery tickets, the ATM withdraws funds from the cardholder’s designated checking or savings account. Linq 3 software picks the lottery numbers, reducing cardholder time in front of the ATM.
If the ATM issues a ticket that later wins, it deposits the winning funds into the cardholder’s designated checking or savings account if they fall below state and federal taxable amounts, which range from $600 to $2,500, depending on the state. For larger amounts, winners redeem tickets at local
lottery offices.
The ATM/lottery machine could appeal to restaurants and stores that do not sell lottery tickets but want an ATM, Cage says. He also expects the machine to boost revenues for marginal ATMs and those deployed in strong locations and to attract consumers who do not play the lottery.
“The machine can rejuvenate the ATM ISO market, increasing revenue per machine,” says Smith. “We need a new product. It’s do or die for some of us. We must provide products offering more than cash withdrawals.”
The ATM’s Windows operating system excited Smith. “It is not a proprietary system,” he says. ATM manufacturers and ISOs will be able to license the software, Cage says.
