In a world that is being shaped by digital connections and convenience, it is not much to say that cash is becoming irrelevant.
Fremont, CA: The use of paper maps are all but obsolete and replaced by GPS, airplane boarding passes are being delivered electronically, and the practice of writing letters by hand is similar to a far-flung friend or relative. Still, the paper money remains, even in 2020 which is the most futuristic-sounding of years, New York City has passed legislation that obliges brick-and-mortar businesses, which states that all global cities have to accept cash. Various other U.S. cities and jurisdictions have enacted similar laws. Even though the slowly declining, cash remains as the preferred payment method in this country, the Federal Reserve research shows that cash remains to be one of the most used payment instrument, and surprisingly young adults under the age of 25 prefer using cash.
Cash firmly rooted in the economy, the ATM, which has been here for above 50 years, is an important physical touchpoint for financial institutions in order to stay connected to their customers and members. The biggest hurdle is to evolve the fleet of ATMs to meet the rising expectations of cardholders in this digital new normal.
Not so Convenient Convenience Fee
The consumers have witnessed many useful high-tech changes at the ATM, starting from image deposit and video teller capability to peer-to-peer money transfers. Following these changes, the consumers have noticed an annual increase in the creation of fee-free cash.
According to a survey, 77 percent of U.S. consumers state that they do anything possible to avoid the payment of ATM surcharges, with 65 percent who are actively seeking out ATMs that are in surcharge-free networks. Based on a report from October 2019, the average ATM surcharge reached a record high with 2 percent more than the previous year for the 15the consecutive year.
Consumers desire convenient access to no-cost ATMs wherever they reside, work or travel, spurring the formation of a sizeable surcharge-free ATM network. These networks enable financial institutions to compete on a national scale by offering surcharge-free access to a wide range of ATM locations; therefore, the accountholders can make transactions surcharge-free outside their traditional footprint and whenever they travel. This increases cardholders' convenience, retention, satisfaction, and acquisition while increasing the interchanging income opportunities via higher transaction volume and premium interchange rates.
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