How one AI startup aims to redefine the ATM experience
By replacing PIN codes and bank cards with Alchera’s facial recognition technology, ATEC AP, a financial automation company, is bringing next-generation ATMs to the banking sector.
The ATM is more than 50 years old. Will it survive another 50, or is it destined for the tech trash bin alongside fax machines and telephone booths? Some experts say its future depends on an ATM revolution.
The history of the ATM is dotted with periods of notable innovation. On the back end, NCR’s model 5070 was a game changer. First deployed in the 1980s, the self-contained unit with modular components simplified installation and reduced maintenance costs. It also introduced new software that enabled world-wide ATM networking.
On the user side, ATMs have evolved from clunky, single-function cash dispensers to multi channel transaction corners. In some places, you can buy train tickets and mobile phone minutes in addition to standard banking services like paying bills, transferring funds, and of course withdrawing cash.
For five decades, ATM innovation hummed along at a carefree pace. Today, that song seems out of tune. Take customer account authentication, for instance. The current system, a PIN code working in tandem with a magnetic strip on a plastic card, was developed by a British engineer in 1970. Not much has changed since then.
In 2019, pilot projects scattered across the world demonstrated the feasibility of replacing PINs and cards with facial recognition account authentication.
Building on that modest success, ATEC AP has a vision for the future ATM. It aims to help its banking clients improve the ATM customer experience by replacing PINs and cards with AI technology.
Finding a solution provider with the right technology and a track record of success was critical. That’s why ATEC AP partnered with Alchera.
ATMs in the future will meet the needs of a diverse customer base. In South Korea, contact-free facial recognition lies at the intersection of those needs.
ATMs, for instance, will address the service implications of the country’s rapidly aging population. Low birth rates, combined with longer life spans and low immigration, means the 65+ cohort is expanding. Memory decline with age is inevitable, so it’s reasonable to expect that PIN code recall at the terminal will become a barrier to ATM access. Facial recognition improves the customer experience by removing that barrier.
Alongside that demographic change, a swell of fintech innovation is inching PINs and cards to the tech landfill. Mobile point of sale (POS) technology, digital wallets, cashless person to person payments, QR code payments, and others – signal the rise of changing attitudes about money.
ATEC AP hired Alchera to bring its ATM vision to life. The work is ongoing and retail deployments by two Korean financial institutions – Nonghyup Bank and Busan Bank – are expected by the end of 2020.
Facial recognition technology is an Alchera specialty. The company has designed and implemented facial recognition solutions in a diverse range of applications including retail, construction, and airports.
At the ATM, there are three top-level concerns: data security, accuracy, and fraud.
- The Alchera system maximizes data protection because its software does not access the bank’s database. Instead, key datasets are stored on a separate, secure server and accessed by Alchera’s software once an image has been taken at the ATM.
- Accurate image matching is key to delivering a positive ATM experience. Studies show that Alchera’s false positive rate is less than 1% (i.e. the system incorrectly rejects a valid matching image). Alchera’s accuracy has been proven by the NIST’s Facial Recognition Vendor Test and the South Korean Ministry of Foreign Affairs benchmark test that pitted six facial recognition technology providers in a head to head contest including NEC and VisionLabs.
- Alchera’s system uses anti-spoofing techniques to prevent ATM fraud (e.g. a liveliness test to prevent account access with photos).
We’re a technology startup from South Korea. Our domain is artificial intelligence (AI) and augmented reality (AR). Supported by a team of experts in computer vision, deep learning, graphics, data science, and software engineering, we solve problems.
Since 2016, Alchera has empowered businesses to launch products, improve efficiencies, and bring the power of visual AI to their organization.