City National Bank latest to test ‘cardless ATMs’ using smartphone app
City National Bank will be the first financial institution in Las Vegas to begin testing cardless ATMs, which allow customers to get cash using their smartphones.
The Los Angeles-based bank, with nine branches in Nevada and $27.4 billion in assets, said it plans to begin a extensive pilot test of the app in January that when completed will allow consumers to access their cash without their debit cards when they get to machines.
The app allows a consumer to interact with the ATM from the privacy and security of their mobile devices, and stage a transaction before stepping up to the ATM.
The cardless ATM access from City National Bank is expected to be available in Las Vegas next year. BMO Harris Bank, with one branch in Las Vegas, is also testing the technology.
“With this capability, getting cash at an ATM entirely occurs through a mobile app, with the exception of dispensing the money, of course,” Nate Wehunt, senior vice president, digital channels at City National, told attendees recently at the BayPay Event in Palo Alto, Calif.
Wehunt said it also closes a “major gap in the transition from plastic to digital wallets.”
Wintrust Financial Corp. in Chicago is close to completing its testing of FIS’ new Cardless Cash Access service. City National Bank and BMO Harris Bank are using the same technology.
The bank is now in its third test with 400 participants, including employees and customers, using Cardless Cash Access. Wintrust plans to complete its rollout of 180 ATMs by the end of the first quarter.
Tom Ormseth, senior vice president at Wintrust, told Javelin Strategy & Research the bank’s decision was part of a broader mobile wallet strategy because “mobile wallets are inevitable.”
Ormseth described the initial feedback as “overwhelmingly positive.” He told researchers the goal was to “attract a younger demographic.”
Long term, Wintrust is interested in developing a strong base of mobile-empowered consumers who could then be used to entice merchant acceptance of a Wintrust mobile wallet, according to a 10-page case study by Javelin Strategy & Research.
Wintrust expects 20 percent of its mobile banking customers will be “comfortable interacting with their phones to gain cash.”
City National Bank’s app will work on iPhone and Android phones. The app authenticates a user on his or her smartphone.
After a consumer connects a debit card to a mobile app, he or she can tap on the app to select the account and amount of the withdrawal. When at the ATM, the consumer scans a QR code on the ATM screen and, within seconds, the cash is dispensed and an eReceipt is sent to the phone.
To decrease fraud security is provided via the app’s authentication and registration of a user’s smartphone, which eliminates the risk of card skimming and fraud incidents.
“With the proliferation of debit and access to cash at point of sale, financial institutions are looking for ways to expand the utility of the ATM,” said Vince Hruska, senior vice president and head of product strategy at City National Bank.
Hruska said cardless access not only provides a secure and easy way to obtain cash, “but introduces to the client a new way of looking at ATM use.”
Contact reporter Chris Sieroty at csieroty@reviewjournal.com or 702-477-3893. Follow @sierotyfeatures on Twitter.
