Banks are losing their complete dominance in automated teller machines (ATMs) as companies from a variety of business sectors try to cash in on bringing people closer to their money.

Prague-based Pharro Praha CZ became the second company after Euronet to launch a Czech network of ATMs in July. The company intends to have more than 100 ATMs throughout the country by the end of this year, said CEO Martin Gračka.

"Our ATMs will be located mostly at retail chains where people can't pay with cards," he said.

Despite the rapid expansion of bank-operated ATMs, Gračka said there was still room for independent operators on the market. Pharro Praha CZ will compete, Gračka said, by offering additional services to cash withdrawals, such as online payments and bookings.

The project is Pharro Praha CZ's first step in its effort to launch an ATM network in Central and Eastern Europe. Pharro intends to operate as many as 400 ATMs in 29 towns in the Czech Republic, Slovakia, Hungary and Poland.

The company will cooperate with the bank ABN AMRO and First Data International, a part of First Data Corp, an e-payment solutions provider for retailers and financial institutions.

Pharro Praha CZ will install and manage the ATMs, while First Data International will do transaction processing. ABN AMRO will handle all accounts, settlements and payments.

The new multifunctional ATMs will run on Microsoft Windows and be connected to the payment networks through GPRS mobile technology.

In contrast to regular ATMs, the third-generation machines operated by Pharro Praha CZ will have additional, smaller screens for advertising.

Rise of the machines

Gračka said Pharro Praha CZ's ATMs will fill a gap in the market because there aren't enough ATMs to meet demand.

According to a recent report in Hospodářské noviny, there are about 1,200 ATMs per 1 million citizens in the United States and about 550 in the European Union. The ratio in the Czech Republic is only 300 to 1.

ATMs are on the rise, however. Today, there are more than 3,000 of the machines, the vast majority of which are operated by banks. Česká spořitelna controls about one-third of the market, operating around 1,100 machines. Komerční banka follows with 618 ATMs, ČSOB with 552.

Euronet, the only other nonbanking ATM operator, runs 135.

Most ATM operators said they intend to open even more machines.

Klára Gajdůšková, spokeswoman for Česká spořitelna, said the bank intends to launch more than 200 ATMs in the next two years.

To make their ATMs stand out, banks have started upgrading them with various new user-friendly features. For example, Česká spořitelna runs about 40 ATMs equipped with a voice navigator for blind people. Meanwhile, GE Money Bank customers can file credit applications via ATMs.

Cash back

Banks and other financial institutions are also developing a few other strategies for bringing money closer to people.

Starting next year, people should be able to get "cash back" on debit and credit card purchases at the cashier counter of select hypermarkets. MasterCard holders will be able to use the service this year, and Visa will begin offering a similar program in 2007.

Gas station chains, including Benzina and OMV, are also planning to do the same.