Mastercard announced that ATMs in Bosnia and Hercegovina, Serbia and Macedonia must support contactless technology from 2022. This technology is already in place in these countries and several other ones.
During the lockdown caused by the COVID situation, many people went more and more digital by ordering online and expecting less cash. According to a UK study, cash withdrawal dropped by 37% in one year. Despite these figures, there is still a mass requesting cash and expecting to have access to the cash quickly in a secure way.
Advantages from several perspectives
Many articles are discussing the security issues to be reduced by using the contactless interface. Most of them refer to card skimming as a vital factor. It’s a fact that in a traditional ATM, the cardholder must insert their payment card in a hole where the card gets out their sights and can be secretly skimmed or blocked. If the cardholder only needs to touch a contactless surface with their card, the lack of the physical process gives is less chance to the criminals.
On the other hand, many cardholders love to use their mobile phones or watches as their preferred payment devices. As the number of contactless payments at the POS terminals increases, these cardholders may leave their payment cards at home and use only their portable or wearable devices. Currently, they need to carry their cards because not all ATMs support this technology.
At the same time, using contactless technology, the time of one transaction may be much shorter, primarily if the ATM operator supports quick cash amounts. Seconds are saved if the ATM doesn’t need to swallow the card and give the card back.
The payment device remains in the hands of the cardholder during the entire transaction. Consequently, there is less chance that the cardholders forget their payment card in the ATM.
Contactless kernels and certifications
Terminals, including ATMs, must be compliant with the EMV specification and card brand requirements.
EMV L1 and L2 testing are applied to verify whether the terminal works in the way EMV specifies. In the traditional EMV environment, where the cardholder must insert the card into the terminal, the terminal kernel was designed to handle the transactions independently from the brand network. Terminal manufacturers should have created one kernel.
In the case of contactless terminals, EMV specifies several kernel versions. Consequently, the terminals supporting many payment schemes must be compliant with several contactless kernel specifications. Terminal manufacturers should develop one kernel for Mastercard, another one for Visa and so on.
Before deploying the ATM, the ATM operator (the acquirer) must go through the L3 certification process because adding a new interface to the terminal is considered a major change. The L3 process could be successful only if the NFC reader and the terminal software has already received their letter of approval for the EMV kernel specification, which belongs to the payment scheme supported by the acquirer. To learn more about L3 certifications, contact us or consult our service.
Before starting the project, the acquirer had better verify if all preliminary certifications of the terminal are available and aren’t near their expiration date. Finishing a project but failing the certification due to an expired certification is painful.
Don’t block out your customer
ATMs are working 24 hours for 7 days per week. The cardholders use them at weekends, nighttime, and on holidays.
When the branches are closed, the customer has to have access to the 24 hours area. A usual method is that the customer opens this area by swiping his bank card in a reader installed by the door. Tech-lover customers may tend to carry contactless devices only, leaving their cards at home. They may not be able to enter the area if cards readers require to swipe their cards, as they do today.
Sources
- Mastercard transaction processing rules
- Contactless ATM Guidelines (US Payments Forum)
- UK cash machine withdrawals drop by over a third in 2020
- ATM: Is Contactless the Future?
- Sparkasse Bank Bosnia and Herzegovina implement mCash module
- Photo by Markus Winkler on Unsplash
- Photo by Jorge Fernández Salas on Unsplash
- Photo by Magnus Engø on Unsplash
- Photo by Steve Pancrate on Unsplash
- Image from pngtree.com
