The ATM in decline

It is still an indispensable companion in everyday life: the ATM. Fifty years ago the first was built in Germany. Meanwhile, the number of machines is slowly shrinking. Are there replacements?

Customers in a Hamburg savings bank

Dhe ATM is slowly but inexorably losing importance in everyday German life. After the banks installed several thousand new devices per year for decades, the numbers have recently shrunk. According to the Deutsche Kreditwirtschaft – the umbrella association of German banks – there were just under 58,400 ATMs in Germany at the end of 2017. The peak was exceeded with 61,100 machines in 2015.

The causes are digitization and cost pressure. “We have the rule of thumb that operating an ATM costs between 20,000 and 25,000 euros (per year),” says Jürgen Gros, head of the Bavarian Cooperative Association, to which the Volks- and Raiffeisenbanken belong. “That must also be earned. Shooting is not a permanent business model. “

The first German ATM was in Tübingen in 1968

This marks the end of the decades-long triumph of a machine that is currently an indispensable part of everyday life. The first German ATM went into operation in Tübingen in 1968; in 1994 there were 29,400 nationwide. The number doubled by 2015, but 1,600 machines were dismantled from 2016 to 2017 alone.

Actor Reg Varney pulled the first banknotes from a public machine in Great Britain in 1967 ...
The actor Reg Varney pulled the first banknotes from a public machine in Great Britain in 1967 …: Image: dpa

However, this does not mean that there are fewer opportunities to withdraw money now. The machines have lost their importance because, on the one hand, online trading is flourishing and, on the other hand, more and more shops are offering cash withdrawals at the checkout.

... and so people crowded in front of the bank branch.
… and so people crowded in front of the bank branch.: Image: dpa

But that too should only be a temporary phenomenon. Munich-based payment service provider Wirecard believes that in the foreseeable future, the entire infrastructure for payments will be organized via mobile phones. For retailers, cash means costs – simply because the income has to be transported to the bank. Paying by app is already part of everyday life in China, but according to many experts it will also spread in Germany.

Cash is expensive – so are the alternatives

“Retailers expect the service to increase the purchase of goods and also reduce the amount of cash in the tills, which is associated with considerable costs,” says Markus Eichinger from Wirecard. “Today around 85 percent of all transactions around the world still use cash, but the potential for local, purely digital payment solutions such as boon, Orange Cash or Allianz Prime is huge.”

On the other hand, payment service providers like Wirecard charge money to process the payment. The anonymity that cash guarantees is still important to many people.

However, criminals also have their share in the fact that banks gradually lose interest in the ATM. “The attacks on ATMs tend to drive up the costs for insurance or for the repair of the devices and the possibly destroyed surroundings,” says a spokesman for the German credit industry in Berlin. According to the banks, the ATMs will not disappear completely in the foreseeable future, but the industry expects a further decline: “The German banking industry assumes that the number of ATMs will continue to decline slightly in the coming years.”