Register For Our New Online Classes!

The cloud looks to revolutionize ATMs

The introduction of cloud computing technology could lead to improving the ATM use experience.

The NCR Corporation, a US-based software, hardware and technology company, looks to change the future of ATM machines. NCR's Kalpana software is being introduced to bring automatic teller machines, more commonly known as ATMs, into the era of the cloud. Although 2.2 million ATMs can be found in banks, credit unions, convenience stores and many other places across the world, there hasn't been a significant amount of innovation in their technology since their introduction in the 1960s, according to

Currently, most ATM's are independently run on Windows XP software and must be updated manually. They are also more prone to cyberattacks than cloud compatible ATM, according to NCR, such as malware or physical breaches through their easily accessible USB ports. Using NCR's Kalpana software will ideally take these ATM's and connect them with other existing ATM networks and banking systems which can be monitored from a remote location.

"NCR's Kalpana software is the most disruptive change to the ATM ecosystem in decades," said Andy Heyman, president of NCR Financial Services in a statement. "Business and consumer applications are increasingly turning to enterprise or cloud-based solutions that reshape security and enable fast, nimble and dynamic customer experiences. Kalpana software is ideal for financial institutions and independent ATM deployers looking to improve security, quickly advance service delivery through technology, and reshape their cost to serve."

Making ATMs more convenient
However, NCR isn't exactly breaking ground with these cloud-capable ATMs. To say that they're trying to move the technology forward is more accurate. Diebold Federal Credit Union first introduced a prototype of cloud-compatible ATMs back in 2011 and has already planned to make advancements on them. DFCU is working to make cash withdrawals and deposits even more convenient than they already are after being inspired by millennials. By taking advantage of cloud computing software, ATM providers are be able to access a user's information at a moment's notice. The plan is that this will soon be able to happen without the use of a debit or credit card. Given the popularity of smartphones and mobile apps, strides have been taken to make ATMs accessible with mobile devices. In this situation, wallets are becoming less of a necessity and more of an accessory. Mobile wallet applications are becoming the new norm.

"To develop the millennial-inspired ATM, we studied the digital and social habits of today's younger generation," said Frank Natoli Jr., chief innovation officer of Diebold in a statement. "The research led us to choose mobile devices for both the user interface and the authentication vehicle to ensure seamless connectivity between devices. Adding mobile wallet capabilities further capitalizes on the mobile mentality of millennials. Together, the technologies provide a glimpse of the future of self-service banking for today's connected consumers."

ATM providers hope to improve the transaction experience by introducing cloud computing software.ATM technology is advancing to a point where credit and debit cards may be a thing of the past.

Both efficient and cost effective
By connecting ATM machines to a larger network, financial institutions that utilize the machines are improving their management practices. Without the cloud, each ATM machine needs to be individually monitored, and when a problem occurs with one it can go unchecked for extended periods of time.

"Mobile wallet applications are becoming the new norm."

Also, it is believed that up to 40 percent of ATM operation costs can be saved with the new Kalpana software. ATM providers that operate up to 100 machines can expect to save between $540,000 to $840,000 a year. Funds that would normally go towards power management, security updates, support for resolution disputes and many other areas are no longer a major concern.

The cloud appears to be growing in its popularity. It can now be seen in an increasing number of everyday activities where hopes are it will increase the efficiency of technology, be cost effective for all parties involved and enhance security efforts against cyber attacks.

Safety concerns
Before jumping aboard the ATM cloud movement, there are some things that should be kept in mind and prepared for. When ATMs are run and monitored on an individual basis, the amount of people affected by a security breach is significantly lower than it could be if a breach were to occur among an entire network of ATMs. There have been instances of individuals hacking into ATM machines by either plugging something into the USB port or punching in a particular sequence of keys and walking away with over $400,000 in less than two years. That was done over multiple trips to multiple ATMs. While internet security providers are extremely determined to keep up with and anticipate the hacking methods of cyber attackers, there are legitimate concerns of what could happen if someone were to gain access to an entire cloud system. 

To thrive, this new ATM technology must enhance the convenience of the ATM experience while maintaining a high level of security so that members aren't concerned about the safety of their funds.