53 Years

Blog: 53 Years of Financial Technology Innovation and Counting

June 25, 2020  |  THOMAS SCHULZE

June 27 marks the 53rd anniversary of the world’s first ATM. While common by today’s standards, in 1967 the machine’s debut drew crowds from all over. Little did many people realize the impact this technology would have, as it became one of the first innovations to radically shape the financial industry and consumer’s daily lives forever.  It was truly a financial institution’s (FI’s) first major step on the path to branch transformation and transaction migration.

Even the former Chairman of the US Federal Reserve Paul Volcker said in 2009, “The most important financial innovation that I have seen the past 20 years is the automated teller machine, that really helps people and prevents visits to the bank and it is a real convenience.”

That real convenience is now deployed around the world, reaching over 3 million installations. But it’s more than simply a box that dispenses cash; it’s a key player in an FI’s digital strategy. Let’s take a quick look at three major ways the ATM has changed over the years:

1. ATMs have become more personalized, integrated and secure: 

Some of the first ATMs used one-time-use bank cards to dispense cash, with the machine eating the card each time a user wanted cash. It wasn’t until the 1970s, when the mag-stripe bank card and card network were introduced, that consumers could reuse the machine with the same card. Shortly thereafter, Diebold Nixdorf recognized the importance of having an integrated, connected solution by introducing one of the first ATMs to be connected to a card network and later, one with an integrated PC. 

Today, the ATM still authenticates most users in the traditional sense of a card and PIN. But innovations in its digital capabilities are now enabling easier and faster onboarding and authentication options, thus increasing accessibility through alternative secure methods, such as near field communication (NFC), mobile pre-staging, or biometrics. Personalized and diverse ways to authenticate have been a part of Diebold Nixdorf solutions since we launched the world’s first iris scanning ATM – prior to even Y2K; we lead the industry with the ability to cater personal messages and screens based on cardholder data, time of day and the location of the ATM.

Leveraging advanced software available today, such as Diebold Nixdorf’s VynamicTM software suite, the ATM can now also connect to a bank’s back-end ecosystem and channels so end-users may be greeted by name like on their online banking platform, schedule a pre-staged transaction with a secure one-time code sent to their mobile device, and finally fulfill the transaction at the ATM. All of these options allow for more integrated personalization and a better, more integrated consumer experience.

2. ATMs have become more efficient, available and future ready: 

Research by RBR shows almost half of all ATMs provide advanced deposit functionality – being able to process and validate cash and check deposits from different currencies and denominations, in multiple sizes, shapes, materials, and security standards from around the world – and with real-time or near-real-time access to funds in the depositor’s account. In fact, a growing proportion of those are able to recycle cash deposits, which can then be dispensed to the next consumer looking to withdraw cash. This cash recycling functionality is gaining greater momentum as FIs look to manage cash more efficiently and handle more transactions through the self-service channel while lessening the number of cash-in-transit interruptions. Enhanced deposit and withdrawal capabilities with larger volumes of notes accepted and dispensed, coupled with recycling, opens up the ATM for more use-cases and helps FIs expand user access to self-service. Small and medium businesses can easily and safely process deposits when it’s convenient for them – and consumers looking for larger withdrawal amounts and denomination selection can access those options through self-service versus going into the branch.  Diebold Nixdorf’s cash recycling experience dates back more than 20 years, and our latest family of solutions, DN SeriesTM, offers an entire suite of cash recycling solutions that enable FIs to gain greater efficiencies. And while your business may not be ready to support cash recycling today, that’s OK, as market-leading ATM solutions like DN Series can operate as a cash-in/out device, with the ability to simply turn on recycling via a software update when you’re ready.

Some may have thought there was an actual person inside the first ATM dispensing cash. And in fact, some people still could believe that when they see how users are actually able to interact with a teller anytime, anywhere at the ATM. Consumers who used to only be able to see their favorite teller in the branch can now reach them via video at an off-site ATM instead. Remote Teller Assistance (including video-teller), that leverages our DN Series ATMs powered by our Vynamic software as an end-to-end solution, allows for complex transactions, such over-the-limit withdrawals, account opening, payments, and authentication of users who forgot their bank card. Not only does this functionality humanize a digital experience, but it also transforms an FI’s operations to extend hours of operation, the markets it serves, the size and format of a branch’s design and even enables a FI to look at new markets with a lighter footprint to start (or as a leave-behind strategy for markets where it’s considering footprint rationalization). 


3. While able to do more, ATMs still meet—and exceed—their fundamental appeal:

Finally, and most importantly, is actually something that hasn’t changed at all: the ATM’s ability to serve. The ATM can be deployed to serve consumers inside the comforts of a branch, outside in extreme temperatures and climates, or even in the middle of the Amazon where few humans have ever ventured. It serves consumers from all walks of life, never discriminating. Delivering cash to a mother who needs groceries in a remote, rural market. Or serving a small business owner who needs banknotes and coins for his cashiers’ drawers. No matter the circumstances, or consumer journey, Diebold Nixdorf has been perfecting access to financial services since we introduced our first full line of ATMs almost 50 years ago. 

What used to be a simple cash machine more than a half century ago, is now a pillar of financial services at the center of a community – in good times and in bad. Diebold Nixdorf has been at the forefront of innovating the ATM for the last 50 years and will continue to be there to help FIs provide essential services to the consumers they serve today and into tomorrow. 

Looking to expand physical and digital financial services? Get with a trusted, proven partner, like Diebold Nixdorf to help. Take the first step by visiting DieboldNixdorf.com/DNSeries.

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