by: Daryl Cornell –

As has been true every year, our predictions will likely prove to be off the mark, highly questionable or just plain wrong. And yet, we will prognosticate again this year, on the off chance that do manage to land a few correct guesses. Here is where we see the ATM industry headed in 2020.

Tap & Go Will Reach Critical Mass.

Those familiar with the payment infrastructures in Australia, Canada and the UK know that NFC or “tap & go” is already a big deal. The ability to pay using debit or credit with no PIN or signature for purchases under $100 has had a dramatic impact on payment methods in these countries. Where once cash was the preferred payment method for purchases under $60 – think pubs and coffee shops – now tap & go reigns. The U.S. once again has been a slow adopter of “tap & go” payment technology after lagging the rest of the world in EMV adoption for nearly a decade. This will change in 2020. While there will be no mass reissuance of U.S. cards like the billion or so during the chip card rollout several years back, issuers are warming to NFC technology.  Most will issue NFC cards as existing chip/ mag stripe cards expire. A few will accelerate issuance in an attempt to claim “top of wallet” status with customers. As a result, POS/ ATM hardware manufacturers and processors will scramble to support NFC technology which will become mainstream in the U.S. in 2020.

Cash Will Remain Stable, Cash Use Won’t.

Cheerleaders for cash will continue to point to the consistent 1% growth in global cash as proof that cash remains king. Cashless advocates will again argue in 2020 that the use of cash, particularly for purchases under $100, is declining. Both are correct. With global interest rates somewhere between nominal and negative, people around the world are hoarding dollars as a hedge against economic and political risk. This raises the demand for cash – particular $100 bills. At the same time, alternative payment methods such as NFC are fueling credit and debit and are eating into global cash usage. For a host of reasons, including continued customer demand for payment choice, cash will remain a viable payment option. However, the days of steady growth of cash as the preferred payment method will wane in 2020.

EMV at the Pump Will Continue to Drag on.

Even after a five-year extension, for a variety of reasons conversion to EMV at the pump will continue to lag in 2020. Roughly half of all service stations are independents, many without the resources to upgrade payment at the pump to EMV. At the same time, the service station chains face their own challenges with complications surrounding POS and ERP conversions. Meanwhile, fraud at the pump continues to spike with deep skimmers, shimmers, PIN cameras and Bluetooth harvesting proliferating. Given the volume of fraud losses involved, issuers and service stations will likely find workarounds. The real casualty of belabored fuel pump EMV upgrade will be yet another delay in the elimination of the magnetic stripe – and the more than $2B in associated global skimming losses. Look for continued foot-dragging, finger-pointing and hand-wringing on EMV at the pump in 2020.

Frustrations with Windows 10 Will Simmer.

On the heels of the recent ATM upgrade from Windows XP to Windows 7, financial institutions are now being forced to upgrade or replace Windows 7 ATMs to Windows 10 machines to remain on a supported platform. If that weren’t bad enough, the sunset of Windows 10 has already been announced, meaning that this exercise will be repeated by some in only a few more years. ATM vendors are licking their chops as the ATM order backlog continues to grow and users now risk missing the January 2021 deadline. The result will be frustrated Windows ATM customers who will be seriously evaluating whether or not to stay on the Windows ATM upgrade treadmill. Many financial institutions will outsource their ATM programs. Others will begin rebating customer ATM fees in lieu of the large, regular capital expenditures required to operate Windows ATM fleets. Some will move to a more economical and secure ATM platform, supported for decades not just a couple of years. The only certainty is that the ATM landscape will look considerably different after 2020.

Happy New Year and a healthy and prosperous 2020 to all!