To Fight Skimming, a Major Credit Union Servicer Adds a Cardless ATM Program

The days of dipping a card into an ATM to withdraw cash may not be as frequent for even more consumers with the announcement Wednesday that Co-Op Financial Services launched its Cardless Cash Access service.

Rancho Cucamonga, Calif.-based Co-Op, a credit-union service organization, says the service can be used on Diebold Nixdorf or NCR ATMs on the Co-Op network that also are managed by the Co-Op Terminal Driving program, which helps credit unions manage their ATMs.

Like others offering such services, Co-Op sees an opportunity to mitigate fraud losses that stem from ATM skimming. “Since the consumer never has to enter his or her card into the ATM itself, skimmers and other devices that capture card data at the ATM become useless,” a Co-Op spokesman says in an email to Digital Transactions News. “Additionally, this solution offers more digital access to consumer accounts, which makes it appealing to many audiences. Lastly, by pre-staging the transaction, the consumer doesn’t have to spend as much time at the ATM when they want cash.”

Cardless Cash Access enables consumers to stage a cash withdrawal from within their credit union’s app. Once at the ATM, the consumer selects the Cardless Cash Access option on the screen. The ATM displays a quick-response code that is scanned within the app. Upon verification, cash is dispensed, eliminating the need to dip a payment card into a reader. Each QR code is unique to each staged transaction.

Co-Op will not say whether the technology is licensed or developed in-house. It also will not disclose how many credit unions use Co-Op Terminal Driving. Co-Op counts nearly 30,000 ATMs in its network. Participating credit unions set the transaction limits, just as they do for traditional ATM transactions. Co-Op will not disclose the cost of the service.

Technology enabling cardless ATM transactions began to surface in 2014 when Paydiant Inc., which PayPal Holdings Inc. acquired in 2015, began licensing its patented technology to financial institutions.