Some area MAPCO stores now feature ‘reverse ATMs’ that allow those who are don’t use banks or simply prefer to deal in cash to pay electric, gas and cable TV bills, as well as transfer money.

-- Photo: Lyle Graves | Nashville Ledger

Customers who normally go to the MAPCO Express convenience store on East Thompson Lane for a bag of chips or a six pack can do something new – pay their bills.

The location is one of 37 MAPCO stores in Nashville and Memphis where self-service, reverse ATMs – machines that collect money instead of dispensing it – have recently been installed.

“A lot of people come in and use it,” says William Stone, a clerk at the Thompson Lane MAPCO store.

The machines, furnished to MAPCO by TIO Networks Corp., can be used in Spanish or English. Most are in neighborhoods that have a high cash-preferring demographic, which includes people without bank accounts and those who use very few banking services, which usually means they have no access to Internet banking or debit or credit direct deductions in order to pay their bills.

Federal Deposit Insurance Corp. research shows 10.9 percent of Tennessee’s population is unbanked, while 18.1 percent is underbanked. The machines are especially attractive to young people who receive their wages in cash or who just prefer to use cash to pay their bills.

Retailers benefit from having reverse ATMs, also known as bill-payment kiosks, in their stores because the machines increase foot traffic. Customers using the reverse ATMs usually buy a few items each time they drop by.

“We’ve seen many examples of once a bill-paying machine has gone up in the store, people return,” says Rob Goehring, chief marketing officer at TIO. “They’re like a returning visitor. They come back and transact there one, two, three, four times a month.”

Customers can save themselves time by going to a single location to pay one or more of their utility, wireless, cable and other bills by scrolling through a list of national and local billers, including Nashville Electric Service (NES), Nashville Gas, AT&T, Boost Mobile, T-Mobile, Sprint, Verizon, Comcast, Dish Network, and DIRECTV.

The reverse ATMs also are convenient for making a last-minute payment to ensure service is not cut off.

Many customers pay their bills in increments, so a $120 utility bill can be paid off $20 or $40 at a time several times a month.

Generally, payments can be made at TIO’s reverse ATMs with credit or debit cards or cash. Prepaid cards can be reloaded at the machines, and prepaid payments can be made for prepaid wireless phones.

In addition, the reverse ATMs support money transfers.

For the safety and security of cash-preferred customers, there is a limit to the size of the transaction.

“What we don’t want is people walking in the store with $1,000 to pay their bill,” says Goehring, who adds that MAPCO offers convenient hours and a clean, well-staffed environment for customers to make their payments.

MAPCO Express is a wholly-owned subsidiary of Delek US Holdings, based in Brentwood. The company operates 377 convenience stores in eight states under the MAPCO Express, MAPCO Mart, East Coast, Discount Food Mart, Fast Food and Fuel, Delta Express, and Favorite Markets brand names, with more than half of its stores in Tennessee.

Vancouver, B.C.-based TIO, which writes the software for the reverse ATMs and processes the bill payments, expects to expand the deployment of the bill-pay machines to MAPCO stores in other Tennessee cities.

TIO has a long history of working with a variety of convenience store chains and gasoline companies to install its machines, including Circle K, ExxonMobil and Sunoco.

Some of TIO’s billing partners will deploy their own corporate bill-pay machines in their locations. In those locations, customers can only pay one particular bill. But at the reverse ATMs at the MAPCO stores, customers can choose from thousands of companies to make payments. TIO has more than 10,000 billers as partners, but limits the number of billers a customer can access in each region.

“We typically show the consumer the bills that are most likely important to them in their region,” says Goehring.

Cricket Communications, which initially introduced inexpensive prepaid wireless phones with service within a customer’s home market, was among the first companies to offer a dedicated corporate bill-pay machine.

“A lot of the unbanked waited until the last minute to pay (their Cricket bill),” says Francie Mendelsohn, president of Summit Research Associates, a Maryland-based kiosk consulting and research firm.

Corporate bill-pay machines have fewer problems than the reverse ATMs with thousands of billers, Mendelsohn says. But Joseph Patty, another clerk at the East Thompson Lane MAPCO Express, says he knows of only one instance when there was a problem with the reverse ATM at his store.

Patty says a woman put money in the machine, but the machine didn’t acknowledge the payment. She called the service number displayed on the reverse ATM, and the machine was repaired right away.

TIO has several competitors, the largest among them NCR. Bill-pay machines have been around for at least a couple of decades, says Bob Harlow, business development director for the Eastern United States at KIOSK Information Systems, one of TIO’s competitors.

“I think it’s fair to say that every year we have more and more requests for transactional kiosks,” he says.

Processing fees for reverse ATM usage vary by the type of transaction and biller. They can range from $1 up to several dollars per transaction. NES, for example, charges a $2 service fee.

Some fees are determined by the speed of the payment. With standard bill pay, the payment is entered into an account in two to four business days. Through expedited bill pay, the payment is posted to an account the same day.

The processing fee is divided between TIO and the retailer. Retailers may lease the reverse ATMs or buy them outright. Sometimes they may do a combination of the two. At many locations, a kiosk is built in at the counter, so clerks can take payments from customers who don’t want to use a self-serve machine.

TIO has about 60,000 self-service reverse ATMs or over-the-counter locations across the United States. MAPCO stores have only the self-serve kiosks.