Before last Thanksgiving, the U.S. Supreme Court ruled in favor of class action lawsuits by consumers, accusing Visa, Mastercard and several U.S. banks of conspiring to inflate the prices of ATM access fees in violation of antitrust law.
The lawsuits in question accused the companies of adopting rules protecting themselves from competition with lower-cost ATM networks. The rules blocked ATM operators from charging less when ATM transactions were processed by networks competing with Visa and Mastercard, the lawsuits assert.
Bruce Renard, executive director of the National ATM Council, said the top court in the country late last year ruled against the credit card companies and major banks, which were equity shareholders of Visa and Mastercard, causing constraints in the ATM market.
According to the National ATM Council, U.S. monthly transactions per ATM fell from approximately 3,000 transactions in 2007 to less than 1,500 in 2015.
In addition, the ongoing push to meet EMV mandates has stunted ATM technology roll outs. Liability for chargeback or fraudulent disputes on ATM transactions using a MasterCard-branded card was supposed to shift from the bank or card issuer to the ATM owner last fall. Visa’s liability shift will occur one year later—in October 2017.
“The U.S. EMV ATM migration is off to a rocky start and could result in even more marketplace disruption than merchants experienced with the (point-of-sale) shift,” Renard said.
ATMs STILL RELEVANT
Kevin Huffman, vice president of operations at Portland, Ind.-based Jay Petroleum Inc., said ATMs remain a value-added service at the company’s Pak-A-Sak c-store chain. Within northern Indiana and western Ohio, Pak-A-Sak operates 33 c-stores. Patrons range from unbanked or underbanked consumers to many individuals who need quick cash.
“Yes, our ATM usage is going up,” Huffman said. “As to why, our best guess is that there are more cards out there than ever before, from debit cards from banks to government issued benefit cards.”
Because the chain doesn’t own its ATMs, its supply partner is responsible for ensuring EMV compliance.
If ATM technology has hit a lag in some industry segments, the growth of bitcoin ATMs is slowly expanding into retail channels. Moreover, the new age machines are popping up in c-stores in certain regions of the U.S.
Bitcoins are stored in a “digital wallet,” which exists either in the cloud or on a user’s computer. The machines can send a code to a user’s smartphone, which can be held up to the ATM and scanned.
North America at the end of 2016 enjoyed 73% of global market share, according to www.coinatmradar.com, a website that tracks bitcoin ATM implementation. Of U.S. states, New York possesses the largest percentage of bitcoin ATMS, with 15.8%.