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BMO Harris Bank Launches Cardless ATMs

By Edward O'Brien
March 16, 2015
in Analysts Coverage
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B2B Payments' Can Fintech Finally Connect Business Payments to the Digital Wave? - PaymentsJournal

BMO Harris Bank, the Chicago area’ssecond-biggest bank by deposits, on Monday will announce that 750 of its ATMs,including about 400 in the Chicago area, will give consumers the choice ofwithdrawing cash using their smart phone, eliminating the need to use a debitcard.

BMO Harris Bank’s “MobileCash” rollout is one of the area’s biggest launches of what are commonlycalled “cardless cash” ATMs.

In December, Rosemont-based Wintrust Financial saidit was rolling out 190 such ATMs. Since February, 144 have been installed ingreater Chicago and southern Wisconsin. Wintrust said Friday it has tallied 560withdrawals and received positive feedback.

Consumers use the bank’s mobile app topreset how much money they want to withdraw. Generally, cardless cash machineswork by creating a QR code, a square matrix-style bar code. Customers sign intothe mobile app and hold their smartphones over the QR code on the ATM, whichdispenses the desired cash.

BMO Harris Bank said the transaction takes about 15 seconds,compared with about 45 seconds for a traditional ATM withdrawal. Also, customer card information is not storedon the phone. Software on the ATMs gives the consumer the choice of using acard or going cardless.

The coming ofcardless ATMs (also known as ATM prestaging or mobile cash access) inproduction financial institution IT environments has been anticipated for sometime. We had become aware of suchequipment in test-and-learn environments in our Mercator Banking Channelsresearch a few years ago, with ATM manufacturers, systems providers, and FIsevaluating the potential business cases and potential return oninvestment.

This is a goodexample of the convergence of the ATM and mobile banking channels, and offerssuch benefits as fast setup from the comfort of home, office, or car, as wellas reduced withdrawal times at the ATM. This process also helps FIs potentially eliminate skimming fraud when customersor members withdraw cash from ATMs by using QR codes instead of mag stripe-equippedcards.


Overview by Ed O’brien, Director, Banking Channels for Mercator Advisory Group

Read full story at Chicago Tribune

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