All those folks who get cash back with their debit purchases a group that probably includes you are having a big effect on the automatic teller machine business.
Some banks in northern Nevada say transaction volumes at their teller machines are flat or down compared with previous years. And some big institutions are muscling up their teller machines with new features to keep them competitive.
The trend isn't limited to northern Nevada.
A study by the Federal Reserve Bank of Kansas City found that ATM use peaked around 2000 and has steadily declined ever since. In 2006, in fact, the number of ATMs deployed around the nation declined for the first time in at least a decade.
Teri Charest, a spokeswoman for U.S. Bank, says debit cards present a double-barreled challenge to ATM networks.
The company operates 34 teller machines in northern Nevada, three more than a year ago, but transaction volume is flat.
One reason, she says, is that consumers simply don't carry as much cash with them these days as they use their debit cards for even small purchases. If they don't need cash, they don't go to the ATM.
At the same time, Charest says more con-sumers are getting $20 or $100 back with their debit card purchases instead of withdrawing the cash from a teller machine.
Federal Reserve researchers Fumiko Hayashi, Richard J. Sullivan, and Stuart E. Weiner say there's some irony in the situation.
"Just when banks were hoping that the primary service offered by ATMs dispensing cash might generate significant revenue, they were heavily pushing one of the most successful cash substitutes we have seen," they say in a study of the ATM and debit-card industries.
Kevin Sullivan, an executive vice president with Nevada State Bank in Reno, says consumers' preference to take cash back with their debit purchases rather than rely on teller machines isn't surprising.
Use of debit cards at the point of sale, Sullivan says, doesn't carry the fees that consumers can face if they use teller machines that aren't owned by the bank where they have their deposits.
In fact, the Federal Reserve study of ATM use found that transaction fees appear to have harmed profitability of ATM operators nationwide for the past five years.
Another factor that encourages debit card use over a visit to an ATM, some bankers say, is some consumers' concern about their safety at teller machines located outside, particularly at night. That's providing some impetus to development of drive-up ATMs.
Big retail banks with expansive networks of ATMs are boosting the machine's capabilities as a method to build customer traffic.
Wells Fargo, for instance, has launched teller machines that sell postage stamps or allow users to customize their preferred withdrawal amounts.
The bank, which handles about 500,000 transactions a month from approximately 100 ATMs in northern Nevada, continues to scout new locations, says Chad Osorno, the northern Nevada president for Wells Fargo.
A primary driver, he says, is the bank's focus on providing services whenever, wherever and however customers want them.
Wells expects to open three or four ATM locations in northern Nevada this year.
Bank of America, meanwhile, says deposit transactions at its 18,000 ATMs nationwide have increased by 50 percent with new technology that doesn't require an envelope and provides customers with an image of their deposit transaction on the receipt.
"We continue to look at capacity to ensure that we provide convenient access for our customers," says Betty Riess, a spokeswoman for the bank.
