ATM Machine | Complete Definition

In 1967, the first automated teller machines (ATMs) were installed in London. Today, ATM machines can be found all across the country.

On-site or off-site ATMs are available. ATMs that are located in financial institutions are known as on-site ATMs. Customers benefit from additional options, convenience, and availability, while banks benefit from more revenue from transactions, reduced operational expenses, and increased staff resources.

The most common venues to find an ATM outside of a bank’s physical location are airports, shopping and convenience stores, and malls.

Data terminals, such as ATMs, have two inputs and four outputs. They must communicate with each other via a host processor. The host processor acts as an Internet Service Provider (ISP), allowing bank account holders to use a credit card or a debit card to access any of the numerous ATM networks.

• A bank account user can use an automated teller machine (ATM) to check their account balances, receive or deposit money, move money from one account to another, produce a statement of account activity, and even purchase stamps.
• In June 1967, a British inventor named John Shepherd-Barron installed the first ATM on a street in Enfield, London, at a Barclays Bank branch.
• In the 1960s and 1970s, the social environment in several countries aided the cause of ATMs. Their introduction transformed the way banks communicated with their consumers and revolutionized the banking industry.

History of ATM Machine

As early as the 1960s, several teams worldwide were working independently to develop a mechanism for taking cash from a bank after hours without breaking the law. The following is a chronology of the ATM’s development and spread:

• Luther George Simjian, an American inventor, created the Bankograph in 1960, a machine that allowed clients to deposit cash and cheques.
• The first automated teller machine (ATM) was installed in Enfield, London, in June 1967 at a Barclays bank branch. Its creation is attributed to a British inventor the name of John Shepherd-Barron. Customers could take out a maximum of ten pounds at a time from the ATM.
• Dallas-based engineer Donald Wetzel pioneered ATM deployment in the United States. As part of Chemical Bank’s “On September 2, our banks will open at 9 am, and never close again” campaign in Rockville Center, New York, America’s first ATM was installed in September 1969.
• When British engineer James Goodfellow invented the idea of a personal identification number (PIN) in 1970, it was a challenging moment in the development of self-service banking since it automated consumer identity verification.
• When Citibank pledged more than $100 million towards installing ATMs around New York City in 1977, the number of machines in the United States saw a significant increase. Blizzard-forced bank closures increased ATM use by 20 percent in New York City.
• As a software and technology business in the United States, National Cash Register (NCR) introduced the NCR Model 770 in 1977, a 24-hour ATM easy for customers to use. It was found that the newer model (5070 ATM) was more dependable, adaptable, and customer-friendly than the older type (5060 ATM).
• By 1984, there were 100,000 ATMs in operation throughout the world.
• More than three million ATMs were in use worldwide as of 2018. Retail Banking Research, a consulting organization, expects that number to reach four million by 2021.
• Sophisticated software and technologies like skimming devices were used to perpetrate ATM fraud in the first decade of the 21st century. To keep ahead of the curve, banks created technologies that could identify suspicious patterns in transaction data.
• Despite the rise of digital payment systems in the 21st century, cash remains the preferred payment method in most regions of the world. There is a strong likelihood that ATMs will be used in conjunction with bank branches, mobile banking, and online banking.

Types of ATMs

ATMs can be divided into two broad categories. Customers can only make cash withdrawals and have their account balances updated with these basic units. Complex machines receive deposits and assist payments and transfers using a line of credit and accessing account data.

An account with the bank machine is often required to use the machine’s more advanced functions.

ATMs are expected to become even more common, and ATM withdrawals are expected to rise. In addition to bank tellers, ATMs of the future may have full-service terminals.

Uses of an Automated Teller Machine

Banking has been transformed by introducing automated teller machines (ATMs), which allow clients to transact with their institutions more quickly and efficiently while also relieving bank employees of some of their duties. An ATM can be used in the following ways:

• Withdrawing cash, checking account balances, transferring funds, or changing a PIN are just a few of the frequent functions of an Automated Teller Machine (Personal Identification Number)
• Open/withdraw a Fixed Deposit (FD) or apply for a personal loan at a more modern and advanced ATM. Book train tickets, pay taxes and utility bills, recharge a mobile phone, or deposit cash using this service. Registration at a bank branch is required for some of these services.
• Customers can now conduct financial transactions whenever it is most convenient for them. ATMs can now be found in public settings such as roads, shopping malls, train stations, and hospitals.
• Access to Automated Teller Machines (ATMs) is available around the clock. Even simple activities like withdrawing money can be avoided by using ATMs, eliminating the need to wait in extensive lines at the bank. It has also reduced the burden on bank employees.

The process of canceling payment is offered by some ATM machines not everyone because this process is too complex for a machine to handle. Moreover, reversing the payment process may allow someone to breach the system as technology is not so advanced before.

ATM Design Elements

Although each ATM has a unique design, they all have the same essential components:

Card reader: This component reads the mag stripe on the back label or the chip on the front of the card.

Keypad: The customer uses the keypad to enter their identification number (PIN), the kind of transaction required, and the transaction amount.

Bill dispenser: Bills are delivered through a slot in the machine that is connected to a lock at the machine’s bottom.

Printer: Consumers can ask for receipts to be printed here if they need them. The type of transaction, the money, and the account balance are all recorded on the ticket.

Screen: The ATM displays instructions that aid the customer through the transaction process. Details such as bank details and balances are also displayed on the screen.

Slots for inserting paper checks or cash are now standard on full-service machines.

How to Use ATMs?

Automated Teller Machines (ATMs) require a bank account and an ATM card to operate. An ATM card can be used to withdraw cash. However, a debit card can make purchases online and with a touch. The same bank often issues debit and ATM cards. You can use this card for cash withdrawals and other uses supported by the ATM.

Withdrawal limitations of an ATM machine

The daily, weekly, and monthly withdrawal limits you have at an ATM depend on your bank and the status of your account there. Capital One imposes a $1,000 daily ATM withdrawal limit on most account customers, but Well Bank has a maximum of $300.8. These restrictions can be overcome by contacting your bank and asking for permission or depositing additional monies.

How do you deposit money at an ATM?

Customers of a bank may have the option of depositing cash or checks at one of their ATMs. You may accomplish this by inserting the checks or money into the machine. Depending on the device, you may be required to insert cash into an envelope after filling out a deposit slip. Make sure you sign and date the back of your cheque before depositing it.

Conclusion:

This shows that ATMs have increased people’s access to money and ease of use. Having cash on hand is essential in an emergency, especially if you are not at your bank location. Because you aren’t reliant on banks, you can withdraw money on bank holidays and after work hours.