If you find yourself in Arizona, first off, let me apologize: I am sorry that you are in Arizona. But interesting banking news is coming out of that dusty, hot, and mostly foreclosed-upon state: ATMs that dispense more than just cash.

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An Arizona based company called Better ATM Services has created technology that allows ATMs to, in addition to dispensing cash, sell gift cards. According to the story in the Arizona Republic, the gift cards will be sold in a variety of denominations, in increments of $25. It does not say whether the gift cards are vendor-specific or not. Currently, the service is available at the ATMs of three Arizona credit unions.

The benefit to Better ATM Services comes in the form of ad revenue, from coupons that pop out with every purchased gift card. An interesting side note about the gift cards: the only reason this works is because gift cards are about one-third as thick as your ATM card, according to the story.

What else is thinner than your credit card, but potentially valuable, and not money? That’s for Better ATM Services to figure out. Ultimately they want to get other thin things through ATM cash dispensing slots. The story suggests that transit passes and tickets could be new sources of revenue. We already buy movie tickets and subway passes at special use kiosks, so why not bring them to ATMs? After all, it’s high time that banks came up with a new stream of revenue from ATMs, other than through fees on non-customers. And third parties are moving in to provide free ATMs where banks cannot. Already in New York, we have ATMs that are surcharge-free, so long as users subject themselves to advertisements.

By collaborating with local transit authorities, and national theater chains, banks could make ATMs a machine people don’t dread interacting with. Especially with debit and credit cards gaining still more widespread acceptance, a machine that charges exorbitant fees to for access to cash might look less and less attractive as technology makes transactions increasingly simple. It would, of course, require a tremendous amount of coordination with public and private sector stakeholders, which could be a major road bump for anyone trying to expand the capabilities of ATMs.

Because customers likely interact with ATMs more than they do tellers, banks might want to consider what other services they can offer their customers through these machines.

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  • Sunshine25

    LOL, you don’t like Arizona either? Beautiful state, lousy politics. It’d be interesting to have an article of all the different items vendable from an ATM past, current, or future. I know I got gouged with Wells Fargo selling me stamps at a premium of $0.10 over face value. Makes me if the consumer will pay a premium on these gift cards, or they will be subsidized by the vendor.

    • While the politics are sort of ugly down there, I dislike AZ for having golf courses in the middle of the desert, and for being a dusty Mars-like hellscape. I don’t deal well with the heat. 

      That’s a good question regarding paying premiums on these goods. I sincerely doubt that big banks will be subsidizing them; they’d likely consider it a service and charge a small premium above face value.