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The ATM: a turning point in the history of banking

Categories : Cash is efficient, Innovation contributes to the efficiency of cash
July 6, 2017
Tags : ATM, ATMs, Cash, Cash cycle efficiency, Innovation, Technology
ATMs are the pioneers for most of the technology used in smartphones and computers. In fact, numerous things were first tested on ATMs before being used elsewhere.
Communication Team / Equipo de Comunicación

The banking industry is currently undergoing major changes with the shift to mobile technologies and virtual currencies. Nevertheless, this might not represent the most significant revolution of the financial sector in the past century. Indeed, the introduction of the first automated teller machines marked the beginning of a new era, especially regarding the accessibility and control of money.

The first ATM was installed in London in 1967, exactly fifty years ago. It was not only the first time consumers interacted with intelligent machines, but it also represented their first experience with digital automation. This innovation brought together traditional paper money with technology for the first time, paving the way for all the developments seen in recent years. Furthermore, most of the technologies that are used in computers and smartphones today – such as biometric scanners, micro-cameras or accelerometers – were first tested on cash machines, making them the pioneers in security devices.

More importantly, ATMs have transformed the relationship to cash, making it accessible anytime and anywhere. Indeed, about 3 million ATMs are currently available around the world, and even the most remote places are equipped with at least one cash machine. For instance, the Khunjerab Pass in Northern Pakistan – located at 4,693 m (15,997 feet) – has its own ATM. In addition, cash dispensers allow for more freedom and privacy as these enable consumers to access their money alone, without needing the services and authorisation of bank staff.

ATMs continue to stay at the forefront of innovation: the latest generation offer cardless withdrawals via a smartphone and video assistance allowing customers to talk with remote bank staff about banking services. What’s more, modern cash machines play a significant role in cases of natural disasters, as mobile and solar-powered ATMs can be delivered by air to give survivors access to money. A great number of such ATMs have been installed by humanitarian organizations in African refugee camps to provide cash-based assistance rather than aid-in-kind, offering dignity and a certain level freedom to refugees.

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