Brief:

• Chase, the retail banking brand of JPMorgan Chase, expanded its service that lets customers get cash from most of its ATMs by using the mobile wallets on their smartphones instead of a debit card. The cash service is available nationwide at 15,000 ATMs and ATM vestibules outside of Chase branches, per a statement.
• Customers won't need to carry their Chase debit or prepaid Liquid cards if they upload their cards to mobile wallets such as Apple Pay, Google Pay or Samsung Pay. They can instead hold their smartphones near a contactless scanner on the machine and then enter a PIN to withdraw cash.
• This week, Chase also announced that users of Samsung Galaxy smartphones can link their mobile wallet to Samsung Pay. That means the bank's customers can use the Chase Pay app at millions of merchants in the U.S. by tapping their phones on special payment terminals at the point of sale.

Insight:

Chase's service to help customers get cash using their smartphones is a major convenience for many people. That's because the growing popularity of mobile payments doesn't necessarily mean an end to cash, which is still popular in the U.S. despite its vulnerability to counterfeiting, theft and loss. Cash is the most frequent way to make payments, accounting for 31% of all consumer transactions, and the demand for cash is strong as a store of value, according to the Federal Reserve. With the demand for cash still high in the country, Chase is aiming to appeal to consumers and provide a greater number of convenient banking options.

Chase isn't the first U.S. bank to offering cardless access to ATMs, which have been in development for several years. Wells Fargo last year introduced similar technology to let customers use smartphones to get cash at its 13,000 ATMs. Initially, the service relied on its mobile app to provide a one-time code to enter along with a PIN number to access their accounts. The bank later started equipping ATMs with near-field communication (NFC) technology to let mobile customers access their accounts by holding their phones near a sensor. Bank of America two years ago let Apple Pay users withdraw cash from ATMs, and last year added more cardless features for mobile app users.

Almost all banks (97%) will have some sort of mobile banking services by the end of this year, with many seeing the technology as essential for retaining customers and remaining competitive with other banks, according to a survey by the Federal Reserve Bank of Boston. The biggest barriers to consumer adoption of this type of mobile feature are security and lack of trust in the technology, the survey found. Even though cardless ATMs help to distribute cash in a convenient manner, they may help to allay customer concerns about the security of contactless transactions at brick-and-mortar retailers. More familiarity with contactless technology likely will help the adoption of Chase's new ATM features and mobile payment services like Apple Pay, Google Pay and Samsung Pay.