ATMs haven’t changed much in the roughly four decades since they first appeared — you stare at a keypad, enter some numbers and get your money. But that’s about to change. Dollar Bank will be among the first financial institutions in the United States to deploy live customer service via video on ATMs.

Dollar Bank, which has 65 branches in the Pittsburgh, Pa., and Cleveland, Ohio, will  introduce video teller banking services in the Pittsburgh market in the late second quarter of 2012.

Partnering with uGenius Technology, a developer of video banking solutions, and NCR, one of the world’s largest manufacturers of ATMs, Dollar Bank will introduce NCR’s APTRA Interactive Teller at walk-up and drive-thru ATMs at select branches.

“We have been evaluating this technology and now believe the video teller service can significantly improve the delivery of service for our customers,” said Robert Oeler, CEO of Dollar Bank, in a prepared statement.

The novelty of the service is a reason for concern. Customers may be surprised when a face pops up on their screen.

“We will introduce this new, convenient banking service to our customers by having a branch employee show them how the remote teller can be used for their daily banking transactions,” said Jim McQuade, senior vice president of retail banking at Dollar Bank, in prepared remarks.

Customers and banks are winners

Introduced in May 2011, NCR’s APTRA Interactive Teller service has the potential to recreate the banking landscape. Not only can banks offer live teller service for more hours,  adding nights and weekend service in locations where previously it was too expensive, banks can build smaller branches in underserved areas.

The greatest beneficiaries of this new technology may be online banks. Imagine ATM centers from ING Direct, Ally Bank or USAA. They would solve some of the online banks’ shortcomings — the inability to deposit cash and the lack of a physical presence.

The adoption by Dollar Bank sets the stage for these online banks, and all banks in the world, to transform how they interact with their customers.

“We have already signed contracts with a number of other institutions,” said Jeff Dudas, an NCR spokesperson, in an email. Dudas says that the names of some of these institutions will be disclosed soon.

Everything old is new again

People of a certain age will remember the charming, and now long-gone, behavior that marked the early use of ATMs. Back then, people were used to dealing with live tellers. The ATMs took some getting used to … and customers tended to adhere to old human-based behaviors when interacting with the machines. And so, when the machines spit out cash, customers often responded by saying “thank you” aloud.

Now, perhaps, that tiny bit of arcane civility may return … without generating snickers from the cynics behind you in line.

Here’s a video of the live teller ATM in action at Mid Hudson Valley Credit Union, who piloted the technology.

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