I know people who will drive for miles and miles out of the way to avoid paying a $3 fee at an ATM not owned by their bank. However, if the latest innovation by Cardtronics (NASDAQ:CATM) catches on, ATM fees may not be a problem anymore for many people.

Source: ALLTM.

It sounds like a silly idea, but shoppers may be glad to pay an ATM fee to get their cash from Cardtronics' new machine.

The ALLTM and what it does
Cardtronics' ALLTM works similarly to a traditional ATM in the sense that customers can insert their ATM cards and withdraw cash. However, through its own smartphone app, the ALLTM can offer in-store discounts and other incentives to users.

When customers walk into a store, they'll see the ALLTM's large digital screen advertising certain discounts and promotions. For example, it may say things like "$5 off with a $50 purchase," or "$0.50 off milk."

Using the mobile app, customers can view a complete list of all offers currently available at any store in the ALLTM network. And, by performing an ATM transaction on the machine, the customer can unlock them and use the offers in-store.

Source: Cardtronics.

Customers simply use their smartphone to scan the QR code on their ALLTM receipt, and then select as many of the digital rewards as they would like to redeem.

Essentially, instead of using their debit card to pay for their shopping, or visiting their own bank's ATM on the way to the store, the ALLTM could make it more cost effective to withdraw money in-store and take advantage of the promotions, which could add up to several times the cost of the ATM fee.

Currently, the ALLTM is being tested in a pilot program at 17 Fresh & Easy locations in Phoenix.

The "Sunday paper" effect
Why are people willing to pay so much more for a Sunday newspaper than a weekday newspaper? For a lot of people, it's for the coupons inside, as they represent more value to the consumer than the cost of the paper.

The same idea applies here. Basically, Cardtronics is offering consumers more value than the cost of the ATM fee. If a consumer has a choice between stopping by their bank's ATM on the way to the store (where they'll pay no fee), or using the ALLTM, paying an ATM fee (say $3), and saving over $10 on their purchases, it makes sense that a lot of people would choose the latter.

Will it work?
Basically, in order to entice people to use the ALLTM, the offers need to be compelling enough for people to go out of their way and use the machines. And, if the offers are good enough, the ALLTM could indeed be a big success.

In an economy where people are becoming increasingly aware of the fees they are paying, and are going to great lengths to avoid them, Cardtronics may have actually done the impossible and figured out a way to make people happy to say yes to an ATM fee.

What about Cardtronics as an investment?
Aside from the ALLTM, Cardtronics is the world's largest operator of non-bank ATMs, with more than 111,000 ATMs that process about three million transactions daily in its network in five different countries. In fact, Cardtronics' network is three times larger than any individual bank's ATM network.

And, the company's record of growth speaks for itself. Over the past 10 years, Cardtronics has grown its revenue at an average annual rate of 18% per year, and is expected to grow at a similar rate in 2015. Despite this growth, the stock is pretty cheap, trading for just 16.5 times 2014's anticipated earnings. Considering that the EPS is expected to grow by about 15% annually through 2016, it seems very reasonably priced.

Plus, if the ALLTM does well and creates an entirely new revenue stream for the company, these estimates could prove to be rather low. One of the most positive signs for investors is when market-leading companies are still capable of innovating, and Cardtronics seems to be doing just that.