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ATM-to-ATM Money Transfer

RedTable
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  • Submitted by: RedTable
  • Created: Dec 10, 2007, 5:57 pm
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The Idea

Enable bank or bank-less customers to go to any ATM, insert currency
and have a recipient visit any ATM domestically or internationally and
have funds dispensed. I feel that utilizing ATMs as a transfer
mechanism will change the money transfer industry.

Today, Envelope-free ATMs can scan cash instantly, which makes it possible to allow customers to send cash to other ATMs instantly. Recipients can get cash from friends and family by clicking on "Get Cash" button and entering a authorization code provided by the sender, the cash is then dispensed. No bank account required. With a daily sending limit of $800.00 USD. A card is provided to senders that allows them to send cash via ATM to ATMs in Mexico or other places like France.

I thought of this idea when I was...

Today only western union and moneygram take the market dosmestically and internationally when sending cash within minutes. Mexicans use western union because it does not require a bank account or any other account. The solution allows banks to get into the money transfer market with envelope-free ATMs connected to ATM's in Mexico from banks like HSBC that owns 5000+ ATMs in Mexico.


Comments Posted

fossiloflife
fossiloflife Posted: December 12, 2007, 3:34 am

RedTable,
well your idea is very consumer friendly....but am afraid that govt's will never buy it...as you cant imagine the amount of fraud gonna happen

RedTable
RedTable Posted: December 12, 2007, 3:48 am

Each customer will use an ATM card to allow them to view the “Send Cash” and “Receive Cash” buttons. This will serve has identification for both parties and will limit the daily transfer up to $800. We can also use 3D face recognition technology to indentify and use the “face image” as a limit hold for $800 daily.

micco
micco Posted: December 12, 2007, 7:46 am

I think the technology is there and it would be a great service. You could certainly limit the fraud potential so it was no worse than existing ATM services.

I wonder about how banking regulations would handle this. In the US, banks have a strict "know your customer" requirement that forces them to do fairly strong checks on people opening accounts, etc. Since this service would be issuing an ATM card, it might fall under the same requirements and then there's not really much difference between what you describe and just opening a conventional bank account. If that's true, this service really becomes just a way to facilitate transfers between different bank accounts (something most online bank interfaces do pretty easily but which aren't available on ATM interfaces yet).

RedTable
RedTable Posted: December 12, 2007, 8:25 am

The ATM card will ‘not’ be attached to any account at the bank. It will serve has a “Money Transfer” ID card. The card will be granted to customers who want to send cash and receive cash via ATM networks. The card will be granted to any customer that walks into a bank by showing a government issued/ or identification ID. The card will have a sending limit of $800.

Ex. Customer A sends $400 using a Bank of America ATM and receiver can stop by any Bank of America ATM and dispense the $400 cash instantly.

RedTable
RedTable Posted: December 12, 2007, 8:40 am

Customer sends $400 “cash” using a Bank of America ATM and receiver can stop by any Bank of America ATM and dispense the $400 cash instantly. A daily sending limit will be set to $800.

We can also use 3D face recognition technology to indentify and use the “face image” as a limit hold for $800 daily.

micco
micco Posted: December 12, 2007, 9:03 am

I understand that your description says it won't be attached to an account. I'm just saying that given the fairly onerous regulations that US banks are under for profiling their customers, they probably can't just issue the card to anyone who shows a single ID. I'm not a banker or a lawyer so I only know of the "know your customer" rules in passing, but they're likely to apply here and they're likely to make the process of getting a card the equivalent of opening an account.

The point is that the people who don't have bank accounts now probably wouldn't want to or be able to get one of these cards IF the banks are required to do a lengthy profile to issue a card (and that's an "if" I can't answer).

RedTable
RedTable Posted: December 12, 2007, 9:26 am

First point: Banks allow Mexicans to open up bank account (e.g Bank of America) by showing a Mexican issues government ID today. But Mexicans/immigrants do not open these bank account because they do not have the funds to hold on American accounts, they come here to send money back home, not keep it here in america (e.g Western Union)

Second point: To send money to friends and family that do not have “a bank account or a bank account within the same bank” domestically “instantly” they have just a few options: Western Union, Money Gram, or paypal “if they have a paypal account” and a paypal debit card. The other options are ACH 3-4 business days and wire transfer up to 24 hrs, which includes the recipient having a bank account.

3rd Point: Moneygram, western union allows senders to send up to $900 USD to any country without the need to show ID per it’s polices. Nor the sender or recipient needs to show ID when the funds are below $900 daily.

Forth point: The service might be “only” provided at Bank of America. And customers might not want to open a bank account but would love to use its instant money transfer service via ATM networks.

RedTable
RedTable Posted: December 12, 2007, 10:02 am

Matricula Consular Card (Mexican) is a accepted form of ID from banks today, including Bank of America.

Summertime
Summertime Posted: December 12, 2007, 8:10 pm

"Nor the sender or recipient needs to show ID when the funds are below $900 daily."

They do idetify with their card at the machine, right? How does the sender designate the recipient uniquely (seems like sender would have to punch in recipient's number)?

It is very expensive to change currencies regularly, isn't it? I understand this is mainly for immigrants, as it is not appropriate for interstate transfer within one country and between citizens.

Summertime
Summertime Posted: December 12, 2007, 8:10 pm

idetify -- identify; sorry

RedTable
RedTable Posted: December 12, 2007, 8:33 pm

The card indentifies the sender correct. The sender by phone/email provides the recipient with the authorization number. The recipient will then enter this number into an ATM to dispense the cash. Today if you live in the USA and travel to Germany (e.g like I did 4 months ago) you can use any ATM to withdraw money and the dispensed currency is that of the country “euro” not “USD”. We will be using the same technology for currency conversion. This will be mainly for immigrants but it can be used to send instant cash to friends and family.

CharonV
CharonV Posted: December 13, 2007, 11:32 am

Western Union and many Banks already offer"Prepaid ATM Cards/Master cards" Some offshore Banks offer such cards with no daily withdrawl limit.

Are you proposing something diferent ?

joyce
joyce Posted: December 13, 2007, 11:47 am

"A card is provided to senders that allows them to send cash via ATM to ATMs in Mexico or other places like France."

...FOREX is a very volatile and really change from one minute and the next. Market forces dictates the movement of a strong currency. The banking law for their services fee and international policy regarding racketeering is very much applied in general transaction for the protection of the free world and capitalist interest.

I guess you missed these things.

-Joyce

RedTable
RedTable Posted: December 13, 2007, 2:10 pm

Joyce, tell me how does the ATM in Italy enable citizens of the United States to dispense cash at the amount requested from a Bank of America debit card?

micco
micco Posted: December 13, 2007, 2:22 pm

I agree about joyce's comment. Everybody from bank ATMs to ecommerce sites handle currency exchange as a matter of doing business. No big issues there.

CharonV brings up a great comparison. Existing pre-paid ATM cards can be recharged pretty easily by handing cash to the merchants who act as partners to the issuer. Your system would take that one step further by allowing recharge by feeding cash into an ATM, but the backend system is essentially the same.

From CH's standpoint, how will you crowdsource this idea? This is a good idea with a big potential market, but it seems like something you would propose to BofA or one of the existing pre-paid card companies rather than start from scratch. From a practical standpoint, it would take serious resources to jumpstart this, or do you intend to partner with an existing bank?

micco
micco Posted: December 13, 2007, 2:23 pm

Note in my first sentence of the previous comment: "I agree about joyce's comment", I was agreeing with RedTable's response, not joyce's original comment.

RedTable
RedTable Posted: December 13, 2007, 3:03 pm

Guys, I will respond to your questions in a few, driving home.

davidwei
davidwei Posted: December 13, 2007, 4:10 pm

This won't work as a CH business - if banks do it they won't pay any of us. The bank would want to have a physical teller count the money before letting someone else withdraw it - unless possibly you had money in your account to cover it.

RedTable
RedTable Posted: December 13, 2007, 4:41 pm

No-envelope ATM deposits provide enough advantages that both Bank of America and Wells Fargo Bank said they will continue rolling out these machines.
"Other large banks are pursuing it," says Tony Hayes, vice president of Dove Consulting, Boston, who says no-envelope deposits have virtually no downside. Their benefits: Your receipt shows a copy of your deposited check and the numbers and denominations of deposited cash bills. Plus, you get faster access to deposited funds.
This technology comes amid cautions from attorneys and the American Bar Association that consumers should think twice about depositing cash at an ATM. Reason: The computer-generated receipt of an ATM deposit only reflects information you key in on the ATM keypad. If you have a problem, it fails to prove you deposited that amount.
But the latest no-envelope ATM technology changes this, said Jonathan Velline, a senior vice president at Wells Fargo. With the new technology, you needn't bother to key in a deposit amount. You just insert your money into a slot and the machine sorts, counts and verifies it. Then, scanned check images and your total deposit amount appear on the ATM screen. You must confirm whether the amount is correct. If not, you can cancel your transaction. If canceled, the machine spits out your cash within 30 seconds, Velline says.

RedTable
RedTable Posted: December 13, 2007, 4:41 pm

davidwei what does CH mean?

RedTable
RedTable Posted: December 13, 2007, 4:43 pm

We will propose to BofA and other banks. The new ATM provides banks with instant cash verification.

PhilipH
PhilipH Posted: December 13, 2007, 5:15 pm

I don't know how they work in the States or anywhere else but here in the UK, ATMs are only for withdrawing money. Making a transfer out of an account would be possible, but feeding in cash is out of the question...

RedTable
RedTable Posted: December 13, 2007, 5:33 pm

Well PhilipH I guess here is that states we beat you!

jGarcia
jGarcia Posted: December 14, 2007, 12:40 am

Here in the Philippines...the cash deposit for an ATM machine needs another day to let Bank authorities check the amount and manually make a bank transfer for their sister branch...while tedious its more fool proof and only works in one confined territory(or a country). I dont how is it in your end. But i agree with Joyce, crossing boundaries needs some foreign exchange calculation and conversion. Your not even pegging to a dollar transaction based on your idea description which make me wonder more.

My .2cents

JustMe
JustMe Posted: December 14, 2007, 12:56 am

So you deposit a an envelope full of monopoly money cause the ATM does not know the difference) and it gives the recipient $800 in real money.

RedTable
RedTable Posted: December 14, 2007, 3:26 am
xfrieres
xfrieres Posted: December 17, 2007, 1:30 am

SO?

RedTable
RedTable Posted: December 17, 2007, 4:44 am
jobby
jobby Posted: December 17, 2007, 1:33 pm

You can just pay cash into the recipients account (at their bank) and it is there for them to withdraw immediately. Well that's the case in the UK anyway so I don't see the benefit really. If you were going to make a trip to the ATM why not just go to the recipients bank branch and pay it directly into their account using their A/c No and sort code.

Again, this is how it works in the UK, sorry if it's not the case in the states.

RedTable
RedTable Posted: December 17, 2007, 5:13 pm

The product is to convet ATM's into Western Union agents. Most people that use money transfer to mexico and other latin counties do not have a bank account and would not want to open one in america. This product focus is bank-less customers.

Kevin_Cox
Kevin_Cox Posted: December 17, 2007, 6:19 pm

"You can just pay cash into the recipients account (at their bank) and it is there for them to withdraw immediately. Well that's the case in the UK anyway"
The same is true for most US banks.

I can see this working maybe for small amounts of money.

I don't see how you can enforce a "daily sending limit" when the user does NOT USE AN ID.

I think the idea is VERY hard for CH to make happen. Due to the limits of ATMs.

RedTable
RedTable Posted: December 17, 2007, 6:42 pm

Like I said again. This product is for bank-less customers.

echen
echen Posted: December 18, 2007, 8:45 pm

Good thinking however,

a) Doesn't seem to be a Crowd Sourcing product/project
b) A form of this is already used in Taiwan. However, you must have a bank account ( ie. ATM card ); one of the options on the ATM is to wire money to another account. Many e-Bay / Yahoo auction transaction are transacted through this mechanism. You win the bid and then goto any 7-11 / convenience store in town and wire the money to the seller's bank account.
c) It doesn't seem very secure or feasible to offer this kind of service to a bank-less customer. MAYBE, you can use a Credit Card and charge the deposit; but you must have some way of authenticating the user and also verify the funds being deposited.
d) "A card is provided to senders that allows them to send cash via ATM to ATMs in Mexico or other places like France." Isn't this a definition of a Bank account? It's more like a joint account where multiple people have a card and know the security code.

 

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