It is now easier than ever to pay for goods and services electronically, removing the need to handle currency. You can use your phone’s mobile wallet to replace payment cards, and you can even use it to withdraw cash from an ATM. Moreover, you probably use your mobile device everywhere, including short journeys away from home, without a debit card. Therefore, it is very interesting to learn how cardless ATMs work. As a result, you can make a well-informed decision about your next withdrawal.
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What Exactly Is a Cardless ATM?
Cardless ATMs are automated teller machines that allow users to withdraw cash without the need to put a bank card into the machine. This new technology makes your time spent at the ATM less stressful and more productive. You can carry out the same banking activities with a card. Examples are cash withdrawals, inquiries about your balance, and other related activities.
In addition, accessing an ATM through your bank’s mobile app is a feature made available by several major financial institutions. They include Chase Bank, Bank of America, Wells Fargo, and others. However, this is not only available to users of large banks. It is highly possible that your local credit union or small bank also offers cardless ATM withdrawals.
Working Principle of Cardless ATMs
Generally, to use a cardless ATM, you have to enter card details from your phone’s mobile wallet such as Apple Pay, Google Pay, and Samsung Pay. Moreover, you may need to download your bank’s or credit union’s mobile app for cardless ATM transactions. In addition, you have to use your mobile device to authenticate your identity and authorize the transaction. As a result, your smartphone will interact with the ATM using a QR code or radio waves.
Cardless ATMs use the following technologie to connect your digital debit card information to the ATM.
Near-Field Communication (NFC)
NFC allows devices to communicate in close proximity by using radio waves that travel only four inches or so. It requires the devices to be close together. As a result, when using an ATM, your bank may urge you to tap your phone in a certain place. Importantly, when you tap your phone, information about your card is sent to the ATM. The transaction is then authorized by entering your PIN or using other methods.
QR and Other Verification Codes
Cardless transactions may necessitate the use of more than an NFC device or card to prove your identification. In some situations, the ATM displays an image of a QR code that you can scan with the camera on your mobile device.
Biometrics
Biometric security solutions use your body to verify your identification. It provides extra security for your bank accounts. The most prevalent biometric security mechanisms on phones are facial and fingerprint recognition. When you enable cardless ATM transactions, it is a good idea to protect your wallet with face or fingerprint verification or a strong passcode. For instance, you may configure your phone to require a fingerprint scan before granting access to your digital wallet.
Advantages and Disadvantages of Cardless ATMs
Advantages
- Fast
Withdrawing money from an ATM without using a card can help you save time, and you can even start the process before you go to the ATM.
- Travel Light
It does not matter if you leave your cards at home by accident. All you need is just your phone.
- Secure
Your card cannot be stolen when you are out in public since you do not use your card to make purchases. Moreover, you will not lose your card. In addition, if entering your identification number (PIN) is not required by your bank or credit union, there is no chance that other people will see your PIN.
Disadvantages
- Compatibility
The app for your bank and NFC should be able to be handled by the majority of modern smartphones when they are necessary to do so. However, there are some circumstances where you might not be able to make cardless purchases. An example is when you have an outdated phone.
- Security Concerns
When your money is lost, losing your phone can cause you much more hassles than it already does. Thus, maintaining the app on your phone is of the utmost importance. It will enable all available security measures such as biometric security and two-factor authentication.
- Not Widespread
Not all ATMs may offer cardless access. Moreover, it is also possible that your bank does not have any cardless ATMs in your immediate area.
Is a Cardless ATM Right for You?
If you prefer to carry as little as possible when you are out, cardless ATM access is a fantastic option. Furthermore, since cardless ATMs allow you to leave your physical debit cards home, you lessen the risk of loss or theft.
Nevertheless, you have to check with your bank to see if cardless ATM use is a viable option for you. If you choose this option, you should ensure that you have strong security measures on your phone’s lock screen, mobile wallet, and bank apps. However, if you are content with your present method and don’t mind the concept of a dead phone battery preventing you from withdrawing cash, there is nothing wrong with sticking with plastic.
Conclusion
To summarize, cardless ATMs provide a more convenient, secure, and sanitary way to withdraw cash without using a card. They are also useful in emergencies, even if you don’t utilize them regularly.
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Source: thebalance