January 29, 2016
Two banking industry giants - Bank of America and Wells Fargo - are working on integrating Apple Pay into their ATMs, as reported by TC. The engineering teams of both banks will be working for several months on Apple Pay options.
While Bank of America’s Consumer Banking Products press representative Betty Riess didn’t provide any specifics, she confirmed to TC that the bank is currently developing a new cardless ATM solution. This solution will enable customers to leverage NFC (near field communication) technology on their smart phone in order to authenticate and complete transactions at a Bank of America ATM. We will roll out this capability in late February with associates at select ATMs in Silicon Valley, San Francisco, Charlotte, New York and Boston followed by a broader roll out to customers mid-year.
Wells Fargo’s head of ATMs, Jonathan Velline, on contrary, was more informative and confirmed to TC, We’ve been working on the technology that allows us to hook to digital wallets, leveraging NFC on mobile phones to replace the card at the transaction at the ATM. Right now the wallet that we support is Android Pay.
Velline also added, But we’re also looking at lots of different mobile wallets and evaluating which ones are going to be appropriate for our customers. We’ll likely add more mobile wallets throughout the year. We recognize our customers are going to have lots of different types of wallets based on their device, based on their bank, based on their OS, and we’re going to continue to find the right balance of which wallets we’re going to support. Right now the initial launch is with Android Pay, but that doesn’t limit us from considering other mobile wallets.
It seems that Apply Pay will soon be among those wallets supported at ATMs.
Apparently, Apple Pay enabled ATMs will allow iPhone owners with digital wallet to withdraw cash without a credit or a debit card. As for merchants’ NFC-enabled terminals, users probably would be able to swipe their phones into ATM to withdraw funds by verifying transaction with the passcode or thumbprint on the phone screen. Upon logging in, users would be able to access some ATM functionality as if they had inserted their card and entered their pin, TC assumed.
While neither of parties has officially confirmed the news, another banking industry mammoth Chase just yesterday announced that it will be rolling out cardless ATMs this year. Chase will deploy new cash machines that don't require a card and will upgrade existing machines that will allow customers to withdraw more money, said Chase spokesman Michael Fusco. The withdrawal limit will be pumped up to $3,000 during branch hours.
The first generation of these new ATMs will allow customers to access the machine by inputting a code found on their Chase mobile app, spokesperson added. Future upgrades of machines will allow customers to use their cell phone's near-field wireless communication feature to access their accounts, using the technology that enables shopping checkout features such as Apple Pay and Samsung Pay.
How does this affect the security?
There are several ways Apple Pay integration into ATMs can benefit banks. Unlike credit and debit cards, Apple Pay integration would be much more difficult to duplicate on iPhone.
In addition, Apple Pay has a capability to set more complicated passwords than traditional 4-digit pins for cards.
Most importantly, NFC technology integration into ATMs will ruin it for card skimmers. As there will be no need to use a physical card, card skimming will no longer be a threat.
All the three factors highlighted above can significantly contribute to NFC technology usage at ATM even though one of the strongest concerns among users has always been security. And if the three biggest banks in the US massively roll out new ATMs with enabled NFC capability, contactless may be taken to another level in the country.
What does this mean for Apple Pay?
Another year that was not so favorable to Apple is 2015, as the tech giant had to struggle with overall low adoption of its digital wallet in the US and complexities it met rolling out internationally.
Some recent news has made the race for Apple Pay even tighter with other powerful players in different markets either launching their own pays, or expanding their own services.
For example, Venmo, a service operated by PayPal, announced about its expansion from being a P2P payments product to an in-app purchases product. The company just announced partnerships with sports ticket app Gametime and food delivery app Munchery — both of which will now use payment info stored in Venmo to let users buy tickets or order meals.
Another disturbing news came from National Australia Bank just when Apple Pay already have had enough on its plate, having problems rolling out on the continent. Some days ago, NAB announced about the launch of its new mobile payment service NAB Pay, which will enable customers to use their mobile phones to make purchases. Android-based device owners who have an account with NAB (NAB Visa Debit Card) can start using NAB Pay, a service that is now available as part of the NAB Mobile Internet Banking App.
Those are just the few things that happened in last few days, not mentioning the whole 2015 with wallets coming out almost every month. However, the struggle for Apple Pay may soon end, with the most powerful institutions in the country integrating the wallet into ATMs. Given that iPhone had a mind-blowing success selling its phones, Apple Pay may gain a significant boost both in adoption and in stretch, probably limitless pockets of its parent.