Week 11 - Smartphones to Replace Cards at Bank Machines

The cardless ATM is gaining ground in the US and the world, with smartphone technology allowing for speedier and more secure transactions. 

Banking giants such as Wells Fargo, Bank of America, and Chase are in the process of  installing new ATMs and updating existing ones to allow customers to withdraw cash with a mobile application and then scanning a code to get their money without having to use a card.  It's estimated that 80,000 machines in North America will be in use over the coming 18 months.

Doug Brown of the major provider of software and technology for ATMs, FIS Global, believes the use of smartphones reduces a lot of vulnerabilities.

The new technology is aimed to curb the growing problem of "skimming" in which criminals steal the data on a card by inserting devices into the ATM card slot.

Another security benefit they mention is that authentication on your mobile phone reduces the time spent at the ATM to around 10 seconds instead of the the typical 30 to 40 seconds. 

ATM manufacturer, Diebold, is also working on developing a "headless" teller machine, without a screen or keypad, which dispenses cash from interaction on the smartphone.  Senior business development manager for new technology, Dave Kuchenski, believes this will provide a better user experience.  "If we're using a mobile phone, we no longer have the need for a card, we no longer have a need for a receipt printer, we've dematerialized a lot of the devices. Banks like this, because it has fewer moving parts, so it reduces the total cost of ownership."

This is a very interesting concept that has already somewhat been around.  I have a Galaxy S6 and it comes with 'Samsung Pay', which allows me to make purchases at stores with my mobile phone simply by holding it near the Debit/Credit Card mag stripe reader where the transaction is completed wirelessly.

As for doing away with cards and using our smartphones to withdraw money from ATMs, I think it's a great idea.  From a security standpoint, we no longer have to worry about physically securing a card that can easily be stolen or lost.  I think with technology constantly evolving, this was bound to happen.  There will be many against it just because a lot of us are afraid of change especially when it involves tech security and our finances.  There are also those who do not own a smartphone and surprisingly it's a lot more than you think.  Would this force them to purchase one?  This technology is a great idea with a lot of benefits, but will take a while to completely transition to it.