In a move to ease everyday cash transactions, banks are rolling out ATMs with a new feature: the ability to exchange large bills for smaller denominations. This upgrade addresses a persistent inconvenience for consumers who often struggle to find establishments willing to break larger notes.

The newly equipped ATMs will function as "hybrid ATMs," dispensing smaller denomination notes like 10, 20 and 50. This functionality aims to alleviate the shortage of smaller bills that has been a problem for nearly a decade. For instance, rather than being limited to withdrawing only 20 dollar bills, customers can choose to receive a combination of smaller bills. Some ATMs may also provide coins.

For users, the process is designed to be straightforward. Customers can insert their ATM, debit, or credit card, enter their PIN, and select the "Cash Exchange" or "Change Denomination" option. After selecting their preferred account, users can insert the larger bills into the cash slot. The ATM will then display the available denominations, allowing the user to select their preferred combination and confirm the transaction.

This upgrade represents a significant step in the evolution of ATM capabilities. Traditionally, ATMs primarily dispensed cash in limited denominations. However, modern ATMs are evolving to offer features rivalling in-branch services, such as cardless transactions, live video teller assistance and multi-lingual support. The ability to exchange large bills is another advancement that caters to the changing needs of consumers.

The deployment of these new ATMs is expected to have several positive impacts. It will reduce friction for consumers who need smaller bills for everyday purchases, tips, or transportation. Businesses, especially small retailers, will benefit from reduced strain on their cashiers to provide change, potentially shortening checkout lines and improving customer service.

While the specific rollout timeline and locations are still being finalized, the initiative reflects a broader effort to modernize banking services and improve customer convenience. As the technology continues to evolve, future ATMs may incorporate even more advanced features, such as AI, blockchain, and contactless technologies, to provide seamless and secure transactions.