A cashless ATM is similar to a traditional ATM in that it allows customers to access their accounts to pay cash for services. It even has similar prompts and requires their 4-digit pin code.
However, cashless ATMs are completely electronic. Instead of dispersing physical cash, transactions are made online and the customer is provided with a voucher to confirm that they transmitted the funds to the merchant bank account.
This might seem like a roundabout way to complete transactions, but it’s actually a great option for businesses that have been deemed high risk, such as the medical marijuana industry. It’s also great for doctors’ offices, food trucks, daycares, hair and nail salons, and other businesses that provide specialized services.
The main benefit of a cashless ATM is that it does not require a merchant account. Not only can it be difficult for high-risk businesses to obtain a merchant account, but the costs associated with them can be particularly high.
It’s also easier to set up a cashless ATM account. Contrary to merchant accounts, businesses do not need to provide extensive financial documentation or information. Merchants only need to provide their signed application form, a completed and signed ACH authorization form, a voided check or bank account verification letter, and identification.
While a great solution for brick and mortar high-risk businesses, a cashless ATM can benefit all merchant types by saving them money on transaction fees. The transaction fees are passed on to the customer as a convenience fee for using their debit or credit cards, saving the merchant hundreds, if not thousands, of dollars every month.
It also reduces the likelihood of chargebacks and fraud. Because the card must be present during the transaction and the correct pin must be used, the customer’s identity can be verified as matching the name on the card.
We advise that you prominently advertise that you offer cashless ATMs as a way for customers to pay for your goods and services. You should also post a sign disclosing the convenience fee so that there is no dispute afterward.
The amounts are pre-programmed and are in $5 or $10 increments, up to $1,000. At least one of the pre-set amounts must meet or exceed $40 and you have the option to include an ‘other’ amount, which can allow customers to input specific amounts in increments of $5.
Once they make their payment and produce their voucher to you, any remittance of change must be made from your cash drawer. The charge will appear as an ATM withdrawal on their bank statements, which affords customers a level of privacy.
Transactions are processed in real-time and there’s no end of the day batching required. You will receive the funds in your bank account within forty-eight hours unless there is a national holiday or the bank is otherwise closed. In that case, funds will be deposited the following day.
Once all of the information is received with your application, it typically takes five business days to approve the application, program the terminal specifically for your business and ship it out to you. There are three types of terminals available: dial-up, ethernet, and mobile. After receiving your terminal, you need only plug it in to be able to start processing transactions.
If you want an option to process debit and credit card transactions without the hassle or fees associated with a merchant account, then a cashless ATM might be the best option for you.