For years, Bank of America has been cutting away at its branches in Charlotte and elsewhere, but in 2015 it grew in another area: ATMs.
The Charlotte-based bank reported having 16,038 automated teller machines in the U.S. at the end of last year, a jump of 204 compared with the same period the year before. That’s a noteworthy reversal following a slide in Bank of America’s ATM count from a year-end peak of about 18,685 in 2008.
It’s also the latest example of how some banks nationwide are investing heavily in self-service technology for consumers – at the same time the industry keeps dialing back on costly branches.
Just late last month, Bank of America upgraded a handful of its Charlotte-area ATMs to allow customers to conduct a transaction with their smartphone instead of a plastic card.
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Of the largest U.S. banks, Bank of America says it’s the first to roll out such cardless technology, which it plans to place on all its ATMs eventually. The upgraded machines will still accept plastic cards.
In May, Bank of America also intends to equip 1,500 ATMs with other enhancements. Customers will be able to cash checks and pay credit card bills at the machines. The ATMs will also dispense additional denominations of bills, beyond just $20 bills currently. The bank plans to upgrade additional ATMs with the features.
Broadly speaking, banks see an evolving role for staffers in branches – more toward selling you products, and less toward routine transactions you can do on your own.
Michelle Moore, Charlotte-based head of digital banking for Bank of America, said the bank wants to use ATMs to offer more kinds of self-service. “Our customers have told us that’s what they want,” she said. The bank views branches, she said, as “destination centers around advice.”
Bank of America has trimmed about 1,270 branches from its U.S. footprint since Brian Moynihan became CEO in 2010. At the end of last year, its branch tally stood at 4,726, down by 129 from the same time a year earlier.
Other banks have also been cutting branches as more customers shift toward conducting transactions on their computers and phones, and at ATMs.
The cuts to branches also come as banks look to slash costs at a time when low interest rates are crimping their profits. One Bank of America executive noted last year that mobile and online transactions cost the bank one-tenth of what it costs to conduct the same transactions in a branch.
Bank of America is not the only big bank that’s been adding to its ATM fleet. San Francisco-based Wells Fargo reported having 13,000 of the devices at the end of last year, up by 500 from a year earlier.
While new features on ATMs add convenience for customers, they raise other concerns.
ATMs are already highly popular with fraudsters who place “skimming” devices on the machines to steal customer data and use it to manufacture counterfeit debit cards. As more customers flock to upgraded ATMs, the machines could also become more alluring to criminals.
Moore, of Bank of America, says the cardless technology the bank introduced last month will help combat fraud.
“There’s nothing for them to skim because we’re sending an electronic code,” she said.
But if there is a weak spot, it’s only a matter of time until some criminal exposes it.