Two ways to find a bank.
Because of the growing demand on the consumer side and the unwillingness of banks to work with cryptocurrency businesses, getting a bank account can present a challenge for operators of Bitcoin ATMs. For example, according to an article in Bloomberg about Prasos, which is the biggest network of Bitcoin ATMs in Finland, four out of five banks have chosen to close the accounts of the company when the volume of the transactions that Prasos was processing has increased. If the company loses the remaining bank account, it would not be able to serve customers in the same way it has been doing so before.
From this comes the first conclusion about getting an account with a bank for your Bitcoin ATM business: you should get several bank accounts with various institutions and not stop after getting just one account and thinking that one account would be enough.
Generally speaking, one is the worst number is business and not just when it comes to bank accounts. If you have just one computer, it is only a question of time when the computer is going to freeze or crash. The same is true about employees. If you have one key employee, then it is only a question of time when the employee is going to change jobs or get sick. For this reason, it is much better to have several employees that can do each other’s tasks in case something happens to one of the employees.
If you have several bank accounts, then you will be able to continue to operate even if one of the banks decided to cancel your account. If you have just one account and stay without a bank account, you will not be able to convert cash that customers deposit into your Bitcoin ATM into cryptocurrency that you sell to the customers via the ATM.
One of the problems in working with banks while operating a Bitcoin ATM business is that you will be bringing a lot of cash to the bank, which is something that banks typically get very suspicious about because they want to know where the cash is coming from. Simply telling them that cash is coming from your customers may not be good enough, which is why you may have a stricter set of Know Your Customer and Anti-Money Laundering policies than you otherwise would, but such policies may be one of your negotiation tools when opening an account with a bank.
In addition to having a bank account, you may try and find alternative solutions to working with a bank. For example, you could find miners who mine bitcoins and you can make a deal to be buying the coins from the miners directly. Another way to buy coins without a bank is directly from consumers, however this latter approach does not guarantee stability. If someone has invested thousands of dollars into mining equipment and both the equipment and the person in charge of it are located in your geographical area, then you can be relatively confident that nothing will happen to the person. If, however, you are able to buy some bitcoins from a private party today, this doesn’t mean that you will be able to find a private party to buy Bitcoins from tomorrow.
Finding a bank
When looking for a bank, you have two options. The first option is approaching banks yourself and trying to find several banks that will be willing to work with you. Typically, this approach does work, but you may need to contact a large number of banks, maybe thirty to fifty. When talking to banks, you want to talk to both large banks and to smaller, friendlier local credit unions or other small banks. The reason for it is simple: a big bank may have stricter company-wide policies when it comes to working with businesses that deal with cryptocurrencies. If the bank does have such policies, it is very likely that the policies are going to be overly restrictive. A smaller bank, such as a local bank with two or three branches, may not have developed a set of policies when it comes to dealing with cryptocurrency businesses. For this reason, such a bank will be making decisions on a case-by-case basis. This is where you relationship with the bank can play an important role. If you have been living in your area for a long time and the bank is a small local bank, you may want to underline how you both are located in the same area, how you love the area and want to bring a new service to its residents. Ultimately, a bank cares about risks and compliance with legal requirements and it may be easier to convince a local bank than a global bank because with a local bank you could build a better personal relationship.
The second option is to not try and approach a bank directly, but to work with a company that already has relationships with banks. Such a company would typically be run by people who have been in the financial industry for a long time and who know the players in the industry. Because of their connections and expertise, they may be able to use their existing relationships to help you get a bank account with a bank that would not otherwise work with you.