BANKING: Cash in Supermarkets

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Ever eager to attract new depositors and enlarge their assets, American banks have instituted such patron-pleasing competitive innovations as longer hours, credit cards and robot tellers that will take deposits and, in some instances, disburse money 24 hours a day. Soon customers across the country may also be able to make savings and loan or bank deposits and withdrawals in supermarkets and other stores as a result of a court ruling that removed legal obstacles to a pioneering experiment in Nebraska.

Under the experiment, First Federal Savings and Loan Association of Lincoln put computer terminals into two stores of the state's Hinky Dinky grocery chain. A customer of the S and L can present a deposit or withdrawal slip and a coded identification card to a Hinky Dinky employee, who punches the transaction onto a typewriter-size console tied into First Federal's main computer. Once the central computer approves the transaction, funds that a customer withdraws are transferred from his savings account to Hinky Dinky's account, and the Hinky Dinky employee hands over the cash. A customer wishing to make a deposit writes a check payable to Hinky Dinky; the computer credits the customer with the deposit and debits the grocery chain's account.

Legal Trouble. Customers are enthusiastic about the system because neither First Federal nor Hinky Dinky levies a service charge on their transactions. The chain's executives are pleased because the system attracts more customers to their stores, curtails time-consuming check-cashing operations, and has reduced bad-check losses.

First Federal began the experiment in January 1974, shortly after the Federal Home Loan Bank Board, which regulates S and Ls, allowed them to set up the terminals. But First Federal quickly ran into legal trouble. In what became an important test case, the Nebraska attorney general contended that state law did not permit retail stores to conduct a banking or S and L business and obtained an injunction that shut down the system for six months of 1974. But last month the Nebraska Supreme Court ruled that the stores were not really acting as S and L branches. The ruling not only lets First Federal expand its system but sets a precedent that should encourage S and Ls in other states to put terminals in supermarkets and other stores. Already, two other Nebraska S and Ls have joined the First Federal network, which now operates in 21 Hinky Dinky stores.

Commercial banks are trying to do the same thing, but they face a restriction that S and Ls do not. U.S. Comptroller of the Currency James Smith ruled last December that banks could set up terminals without running afoul of laws in twelve states that limit branch banking, but last month specified that the terminals could not be put in locations more than 50 miles away from a bank's main or branch office. In addition, small bankers, worried that big banks and S and Ls will win away depositors, are backing two bills in Congress that would severely restrict deposits and withdrawals in the supermarket.