NFC NOW MAKES CARDLESS WITHDRAWALS AT ATMS POSSIBLE
It feels like a new payment method is introduced all the time. Converging technologies and consumers’ hunger for choice have encouraged faster innovation, resulting in the wide variety of payment methods we now enjoy. In spite of all of this, cash remains a fundamental form of currency. In fact, cash and alternative forms of payment have complemented each other more than anything else.
One sign of this is the recent development of ATMs that can dispense cash without the use of a bank card. These Cardless withdrawals are made possible by combining two technologies that were previously thought to be a threat to cash, i.e mobile wallets and NFC technology. How do these withdrawals work and what implications do they have for consumers? Let’s find out.
FROM CONTACTLESS PAYMENTS TO CONTACTLESS WITHDRAWALS
NFC – Near Field Communication which is a contactless banking deployment solution is nothing new. It is the successor to radio frequency identification (RFID), which allowed devices to transfer small amounts of data between each other. NFC uses microchips that can be embedded in nearly any object to do the same thing. Keyholders, debit and credit cards, and devices like smartphones, tablets and laptops can all be NFC-enabled nowadays.
Contactless payments exist because of NFC technology. Bank cards, smartphones, wristbands and rings embedded with NFC chips and paired with mobile wallets (like Apple Pay, Android Pay and PayPal) can be used at NFC-supporting POS terminals to make payments. Now, banks and financial service providers have taken it a step further by introducing ATMs that work on the same principle as contactless payments to make Cardless withdrawals possible.
We at OFMAX find newer ways to wow our customers hereby deploying innovative solutions for them. NFC is not currently a regulatory requirement in Nigeria, but we’re very ready to carry out a PoC for Banks in need who understands the security level reenforced for its customers not having to carry their cards around. Their NFC-enabled ATMs support Apple Pay, Android Pay, Samsung Pay and Microsoft Wallet; a withdrawal is as simple as selecting a Bank’s Card within a mobile wallet app of your choice, holding your smartphone over the contactless symbol at the ATM, entering the appropriate PIN, and continuing with your transaction as normal. Currently, Bank of America NFC-enabled ATMs allow withdrawals, balance enquiries and money transfers.
IMPROVED SECURITY AND MORE ADVANCED BANKING
The main benefit of Cardless withdrawals is that they make trips to the ATM a lot more secure for consumers. Card-skimming remains a huge problem at ATMs and by completely eliminating the need for bank cards, the issue of skimming is also effectively eradicated.
Additionally, cash withdrawals haven’t been able to provide deeper insight into consumer behaviour the way mobile payments have. By letting customers use their smartphones to withdraw cash, a whole new world of powerful analytics and metrics opens up. Without the technology behind mobile wallets, this wouldn’t be possible.
And, as stated earlier, cash remains the reference point from which most alternative payments are developed and the advent of ATMs that allow Cardless cash withdrawals points to a future where all payment methods can exist synergistically instead of being treated as enemies.