China Firm to Install 2,000 Gold-Dispending ATMs

Gongmei Gold Trading plans to install 2,000 ATMs to dispense gold coins and bullions over the next two years despite a technical glitch that forced it to turn off its first such ATM Sunday.

The machine had been installed in the ritzy Wangfujing shopping district Sunday but had to turned off within hours because it failed to dispense receipts for purchases. The machine will be turned on again in a day or two, promised Gongmei Gold Trading’s operations manager Li Weizhou.

The firm expects to install most of the 2,000 machines in private clubs at banks and at landmark buildings in major cities. The same type of gold-vending machines are already used in Germany, the United States, Italy, the United Arab Emirates and several other nations. They are expected to do well in China, the world’s second largest market for consumer gold after India.

The price the machine charges for gold bars and coins is based on market prices that are updated every 10 minutes. Each gold piece bears a two-dimensional barcode that can be recognized by a scanner attached to the touchscreen-equipped ATM. The first machine in Wangfujing can only dispense gold, but the four machines to be installed in November will be offer buy gold as well.

“The machine will also be able to detect the specific type of gold product and determine the price,” said Zheng.

Gongmei received the right to launch the service from China Unionpay and the People’s Bank of China.

China passed India as the largest gold consumer for the first quarter of this year, buying 90.9 tons, reported the World Gold Council in May. Demand for gold jewelry in China jumped 21 percent during that quarter. China’s gold demand is expected to double before the end of the decade.