How we pay for things has evolved over time, from the olden days of bartering, to cash and coins, and now to the modern days of checks and credit cards. It may seem unbelievable that the next iteration of payment is right in your mobile device, but in some ways it makes sense—after all, your smartphone holds all of your other important information.
With its revolutionary technology to pay at a checkout counter using only your iPhone, Apple Pay has made waves in the mobile payment market and led a new charge. Now it’s taking things one step further by expanding to ATMs.
Apple Pay at the Store
In a world where technology is getting smaller, lighter, and more minimal, people tend to carry around fewer things. Instead of a planner, watch, calculator, or business card, we carry everything we need right in our smartphone. It makes sense then that the next step is to turn your mobile device into a wallet.
Apple Pay was introduced in late 2014 and allows customers to pay for something by just holding their phone over a special payment device, typically located next to the credit card machine. The system taps into a near field communication (NFC) antenna that uses encrypted payment and personal information from a linked credit card, which then creates a unique one-time-use security code that protects the customer’s private information from getting to the retailer. In essence, using Apple Pay connects the payment system to a customer’s linked card without releasing the card number or private information. Customers can only access the digitized traditional card’s chip or magnetic strip with a fingerprint scan or unique passcode. Apple Pay is available on most of Apple’s recent models, including iPhones, iPads, and Apple Watch.
Apple Pay Coming to ATMs
Bank of America and Wells Fargo both have teams working on integrating Apple Pay into their ATMs. The banks haven’t come out and specifically announced their initiatives, but multiple employees for each company have signed on for projects that last for several months. Similar programs are also in various stages of development with other mobile wallets, including Android Pay. Bank of America reportedly recently rolled out the service at a limited number of ATMs, which are designated with the traditional Apple Pay logo on the front.
Wells Fargo head of ATMs Jonathan Velline says the bank currently supports Android Pay, but that it is looking to expand the technology to replace traditional ATM and debit cards with mobile phones at the ATM and alluded to the next phase with Apple Pay.
“We’ll likely add more mobile wallets throughout the year,” he said. “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 for which wallets we’re going to support.”
The details of an Apple Pay ATM are still unknown, but it seems likely the machine would allow customers to remove cash from their account without a card, which is convenient for minimalists and people who may have misplaced their wallet. Using similar near field communication as payment devices, Apple Pay would connect with a sensor in the ATM once the security features were passed. In essence, tapping a phone and accessing Apple Pay would be the same as entering your card and PIN in order to access ATM features.
Some customers seem apprehensive to turn their banking security over to a mobile device, but mobile wallets are actually much safer than debit cards. Apple Pay has unique security features, such as a fingerprint scan, that are not currently on ATMs. With a fingerprint scan, only the registered user of the phone can unlock the Apple Pay feature, and a fingerprint is virtually impossible to duplicate. Apple Pay users can also create passcodes that are more complex (similar to computer-based passwords) than the traditional four-number ATM pin. Mobile wallets are also much more difficult to duplicate than a debit or ATM card.
One of the most common ATM fraud techniques is to place a card skimmer on the machine. Although these devices look very similar to a real ATM façade, they actually duplicate and steal the information of every card placed in the ATM, giving scammers information like a customer’s card number, pin, or bank account number. Because Apple Pay doesn’t have any aspect that is inserted into the machine, card skimmers wouldn’t work at all.
No matter if you lost your wallet, are on the quest for convenience, or want a more secure ATM experience, using Apple Pay to take money out of your bank account could be a welcome development. And who knows—this could be the first wave of ATMs of the future.