![ICAs uttagsautomat ICA Metro Skanstull Stockholm 2005-07-18](https://upload.wikimedia.org/wikipedia/commons/9/94/ICAs_uttagsautomat_ICA_Metro_Skanstull_Stockholm_2005-07-18.jpg)
An automated teller machine (ATM) or cash machine (in
British English
British English (BrE, en-GB, or BE) is, according to Lexico, Oxford Dictionaries, "English language, English as used in Great Britain, as distinct from that used elsewhere". More narrowly, it can refer specifically to the English language in ...
) is an electronic
telecommunications
Telecommunication is the transmission of information by various types of technologies over wire, radio, optical, or other electromagnetic systems. It has its origin in the desire of humans for communication over a distance greater than that fe ...
device that enables customers of
financial institution
Financial institutions, sometimes called banking institutions, are business entities that provide services as intermediaries for different types of financial monetary transactions. Broadly speaking, there are three major types of financial insti ...
s to perform
financial transaction
A financial transaction is an agreement, or communication, between a buyer and seller to exchange goods, services, or assets for payment. Any transaction involves a change in the status of the finances of two or more businesses or individuals. A ...
s, such as cash withdrawals, deposits, funds transfers, balance inquiries or account information inquiries, at any time and without the need for direct interaction with bank staff.
ATMs are known by a variety of names, including automatic teller machine (ATM) in the United States (sometimes
redundantly as "ATM machine"). In Canada, the term ''automated banking machine'' (ABM) is also used, although ATM is also very commonly used in Canada, with many Canadian organizations using ATM over ABM. In British English, the terms ''cashpoint'', ''cash machine'' and ''hole in the wall'' are most widely used. Other terms include ''any time money'', ''cashline'', ''tyme machine'', ''cash dispenser'', ''cash corner'', ''bankomat'', or ''bancomat''. ATMs that are
not operated by a financial institution are known as "
white-label" ATMs.
Using an ATM, customers can access their bank deposit or credit accounts in order to make a variety of financial transactions, most notably
cash
In economics, cash is money in the physical form of currency, such as banknotes and coins.
In bookkeeping and financial accounting, cash is current assets comprising currency or currency equivalents that can be accessed immediately or near-imm ...
withdrawals and balance checking, as well as transferring credit to and from mobile phones. ATMs can also be used to withdraw cash in a foreign country. If the currency being withdrawn from the ATM is different from that in which the bank account is denominated, the money will be converted at the financial institution's
exchange rate
In finance, an exchange rate is the rate at which one currency will be exchanged for another currency. Currencies are most commonly national currencies, but may be sub-national as in the case of Hong Kong or supra-national as in the case of ...
. Customers are typically identified by inserting a plastic
ATM card
An ATM card is a payment card or dedicated payment card issued by a financial institution (i.e. a bank) which enables a customer to access their financial accounts via its and others' automated teller machines (ATMs) and to make approved point of ...
(or some other acceptable payment card) into the ATM, with authentication being by the customer entering a
personal identification number
A personal identification number (PIN), or sometimes redundantly a PIN number or PIN code, is a numeric (sometimes alpha-numeric) passcode used in the process of authenticating a user accessing a system.
The PIN has been the key to facilitat ...
(PIN), which must match the PIN stored in the chip on the card (if the card is so equipped), or in the issuing financial institution's database.
According to the
ATM Industry Association (ATMIA), , there were close to 3.5 million ATMs installed worldwide. However, the use of ATMs is gradually declining with the increase in cashless payment systems.
History
![Früher Bankautomat von Nixdorf](https://upload.wikimedia.org/wikipedia/commons/b/b7/Fr%C3%BCher_Bankautomat_von_Nixdorf.jpg)
The idea of out-of-hours cash distribution developed from bankers' needs in Japan, Sweden,
and the United Kingdom.
In 1960
Luther George Simjian
Luther George Simjian (January 28, 1905October 23, 1997) was an Armenian-American inventor and entrepreneur. A prolific and professional inventor, he held over 200 patents, mostly related to optics and electronics. His most significant inventions ...
invented an automated deposit machine (accepting coins, cash and cheques) although it did not have cash dispensing features. His US patent was first filed on 30 June 1960 and granted on 26 February 1963. The roll-out of this machine, called Bankograph, was delayed by a couple of years, due in part to Simjian's Reflectone Electronics Inc. being acquired by Universal Match Corporation. An experimental Bankograph was installed in
New York City
New York, often called New York City or NYC, is the List of United States cities by population, most populous city in the United States. With a 2020 population of 8,804,190 distributed over , New York City is also the L ...
in 1961 by the
City Bank of New York
Citibank, N. A. (N. A. stands for " National Association") is the primary U.S. banking subsidiary of financial services multinational Citigroup. Citibank was founded in 1812 as the City Bank of New York, and later became First National City Ba ...
, but removed after six months due to the lack of customer acceptance.
In 1962 Adrian Ashfield invented the idea of a card system to securely identify a user and control and monitor the dispensing of goods or services. This was granted UK Patent 959,713 in June 1964 and assigned to Kins Developments Limited.
A Japanese device called the "Computer Loan Machine" supplied cash as a three-month loan at 5% p.a. after inserting a credit card. The device was operational in 1966. However, little is known about the device.
A cash machine was put into use by
Barclays Bank
Barclays () is a British multinational universal bank, headquartered in London, England. Barclays operates as two divisions, Barclays UK and Barclays International, supported by a service company, Barclays Execution Services.
Barclays traces ...
in its
Enfield Town
Enfield is a large town in north London, England, north of Charing Cross. It had a population of 156,858 in 2018. It includes the areas of Botany Bay, Brimsdown, Bulls Cross, Bullsmoor, Bush Hill Park, Clay Hill, Crews Hill, Enfield Highway ...
branch in
North London
North London is the northern part of London, England, north of the River Thames. It extends from Clerkenwell and Finsbury, on the edge of the City of London financial district, to Greater London's boundary with Hertfordshire.
The term ''nort ...
, United Kingdom, on 27 June 1967. This machine was inaugurated by English comedy actor
Reg Varney
Reginald Alfred Varney (11 July 1916 – 16 November 2008) was an English actor, entertainer and comedian. He is best remembered for having played the lead role of bus driver Stan Butler in the LWT sitcom ''On the Buses'' (1969–73) and its thr ...
. This instance of the invention is credited to the engineering team led by
John Shepherd-Barron
John Adrian Shepherd-Barron OBE (23 June 1925 – 15 May 2010) was an India-born British inventor, who led the team that installed the first cash machine, sometimes referred to as the automated teller machine or ATM.
Early life
John Adrian Shep ...
of printing firm
De La Rue
De La Rue plc (, ) is a British company headquartered in Basingstoke, England, that designs and produces banknotes, secure polymer substrate and banknote security features (including security holograms, security threads and security printe ...
,
who was awarded an
OBE in the
2005 New Year Honours
New Year Honours were granted in the United Kingdom and New Zealand at the start of 2005. Among these in the UK were knighthoods awarded to Mike Tomlinson, the educationalist; Derek Wanless, who led a review of the National Health Service; and ...
.
Transactions were initiated by inserting paper cheques issued by a teller or cashier, marked with
carbon-14
Carbon-14, C-14, or radiocarbon, is a radioactive isotope of carbon with an atomic nucleus containing 6 protons and 8 neutrons. Its presence in organic materials is the basis of the radiocarbon dating method pioneered by Willard Libby and coll ...
for machine readability and security, which in a later model were matched with a four-digit
personal identification number
A personal identification number (PIN), or sometimes redundantly a PIN number or PIN code, is a numeric (sometimes alpha-numeric) passcode used in the process of authenticating a user accessing a system.
The PIN has been the key to facilitat ...
(PIN).
Shepherd-Barron stated "It struck me there must be a way I could get my own money, anywhere in the world or the UK. I hit upon the idea of a chocolate bar dispenser, but replacing chocolate with cash."[
The Barclays–De La Rue machine (called De La Rue Automatic Cash System or DACS) beat the Swedish saving banks' and a company called Metior's machine (a device called Bankomat) by a mere nine days and Westminster Bank's– Smith Industries– Chubb system (called Chubb MD2) by a month. The online version of the Swedish machine is listed to have been operational on 6 May 1968, while claiming to be the first online ATM in the world, ahead of similar claims by IBM and ]Lloyds Bank
Lloyds Bank plc is a British retail banking, retail and commercial bank with branches across England and Wales. It has traditionally been considered one of the "Big Four (banking), Big Four" clearing house (finance), clearing banks. Lloyds B ...
in 1971, and Oki
Oki or Ōki may refer to:
Places
*Oki District, Shimane, a district in Shimane Prefecture, Japan
*Oki Islands, an archipelago in the Sea of Japan
*Oki Province, a former province of Japan
*Ōki, Fukuoka, a town in southern Japan
*Oki Airport, the ...
in 1970. The collaboration of a small start-up called Speytec and Midland Bank
Midland Bank Plc was one of the Big Four banking groups in the United Kingdom for most of the 20th century. It is now part of HSBC. The bank was founded as the Birmingham and Midland Bank in Union Street, Birmingham, England in August 1836. It ...
developed a fourth machine which was marketed after 1969 in Europe and the US by the Burroughs Corporation
The Burroughs Corporation was a major American manufacturer of business equipment. The company was founded in 1886 as the American Arithmometer Company. In 1986, it merged with Sperry UNIVAC to form Unisys. The company's history paralleled many ...
. The patent for this device (GB1329964) was filed in September 1969 (and granted in 1973) by John David Edwards, Leonard Perkins, John Henry Donald, Peter Lee Chappell, Sean Benjamin Newcombe, and Malcom David Roe.
Both the DACS and MD2 accepted only a single-use token or voucher which was retained by the machine, while the Speytec worked with a card with a magnetic stripe at the back. They used principles including Carbon-14
Carbon-14, C-14, or radiocarbon, is a radioactive isotope of carbon with an atomic nucleus containing 6 protons and 8 neutrons. Its presence in organic materials is the basis of the radiocarbon dating method pioneered by Willard Libby and coll ...
and low-coercivity magnetism
Magnetism is the class of physical attributes that are mediated by a magnetic field, which refers to the capacity to induce attractive and repulsive phenomena in other entities. Electric currents and the magnetic moments of elementary particles ...
in order to make fraud more difficult.
The idea of a PIN
A pin is a device used for fastening objects or material together.
Pin or PIN may also refer to:
Computers and technology
* Personal identification number (PIN), to access a secured system
** PIN pad, a PIN entry device
* PIN, a former Dutch ...
stored on the card was developed by a group of engineers working at Smiths Group
Smiths Group plc is a British, multinational, diversified engineering business headquartered in London, England. It operates in over 50 countries and employs 14,600 staff.
Smiths Group has its origins in a jewellery shop, ''S Smith & Sons'', ...
on the Chubb MD2 in 1965 and which has been credited to James Goodfellow (patent GB1197183 filed on 2 May 1966 with Anthony Davies). The essence of this system was that it enabled the verification of the customer with the debited account without human intervention. This patent is also the earliest instance of a complete "currency dispenser system" in the patent record. This patent was filed on 5 March 1968 in the US (US 3543904) and granted on 1 December 1970. It had a profound influence on the industry as a whole. Not only did future entrants into the cash dispenser market such as NCR Corporation
NCR Corporation, previously known as National Cash Register, is an American software, consulting and technology company providing several professional services and electronic products. It manufactures self-service kiosks, point-of-sale termin ...
and IBM licence Goodfellow's PIN system, but a number of later patents reference this patent as "Prior Art Device".
Propagation
Devices designed by British (i.e. Chubb, De La Rue) and Swedish (i.e. Asea Meteor) quickly spread out. For example, given its link with Barclays
Barclays () is a British multinational universal bank, headquartered in London, England. Barclays operates as two divisions, Barclays UK and Barclays International, supported by a service company, Barclays Execution Services.
Barclays traces ...
, Bank of Scotland
The Bank of Scotland plc (Scottish Gaelic: ''Banca na h-Alba'') is a commercial and clearing bank based in Scotland and is part of the Lloyds Banking Group, following the Bank of Scotland's implosion in 2008. The bank was established by th ...
deployed a DACS in 1968 under th
'Scotcash'
brand. Customers were given personal code numbers to activate the machines, similar to the modern PIN. They were also supplied with £10 vouchers. These were fed into the machine, and the corresponding amount debited from the customer's account.
A Chubb-made ATM appeared in Sydney
Sydney ( ) is the capital city of the state of New South Wales, and the most populous city in both Australia and Oceania. Located on Australia's east coast, the metropolis surrounds Sydney Harbour and extends about towards the Blue Mountain ...
in 1969. This was the first ATM installed in Australia
Australia, officially the Commonwealth of Australia, is a Sovereign state, sovereign country comprising the mainland of the Australia (continent), Australian continent, the island of Tasmania, and numerous List of islands of Australia, sma ...
. The machine only dispensed $25 at a time and the bank card itself would be mailed to the user after the bank had processed the withdrawal.
Asea Metior's Bancomat was the first ATM installed in Spain
, image_flag = Bandera de España.svg
, image_coat = Escudo de España (mazonado).svg
, national_motto = ''Plus ultra'' (Latin)(English: "Further Beyond")
, national_anthem = (English: "Royal March")
, i ...
on 9 January 1969, in central Madrid
Madrid ( , ) is the capital and most populous city of Spain. The city has almost 3.4 million inhabitants and a metropolitan area population of approximately 6.7 million. It is the second-largest city in the European Union (EU), and ...
by Banesto. This device dispensed 1,000 peseta bills (1 to 5 max). Each user had to introduce a security personal key using a combination of the ten numeric buttons. In March of the same year an ad with the instructions to use the Bancomat was published in the same newspaper.
Docutel in the United States
After looking firsthand at the experiences in Europe, in 1968 the ATM was pioneered in the U.S. by Donald Wetzel
Donald C. Wetzel (born January 3, 1929) is an American businessman known for holding the USA patent to the automatic teller machine.
Born in New Orleans, Louisiana, he graduated from Jesuit High School (New Orleans) in 1947 and got a B.Sc. in ...
, who was a department head at a company called Docutel. Docutel was a subsidiary of Recognition Equipment Inc of Dallas
Dallas () is the List of municipalities in Texas, third largest city in Texas and the largest city in the Dallas–Fort Worth metroplex, the List of metropolitan statistical areas, fourth-largest metropolitan area in the United States at 7.5 ...
, Texas
Texas (, ; Spanish language, Spanish: ''Texas'', ''Tejas'') is a state in the South Central United States, South Central region of the United States. At 268,596 square miles (695,662 km2), and with more than 29.1 million residents in 2 ...
, which was producing optical scanning equipment and had instructed Docutel to explore automated baggage handling and automated gasoline pumps.
On 2 September 1969, Chemical Bank
Chemical Bank was a bank with headquarters in New York City from 1824 until 1996. At the end of 1995, Chemical was the third-largest bank in the U.S., with about $182.9 billion in assets and more than 39,000 employees around the world.
Beginning ...
installed a prototype ATM in the U.S. at its branch in Rockville Centre, New York
Rockville Centre, commonly abbreviated as RVC, is an incorporated village located in the Town of Hempstead in Nassau County, on the South Shore of Long Island, in New York, United States. The population was 24,023 at the 2010 census.
Histo ...
. The first ATMs were designed to dispense a fixed amount of cash when a user inserted a specially coded card. A Chemical Bank advertisement boasted "On Sept. 2 our bank will open at 9:00 and never close again." Chemical's ATM, initially known as a Docuteller was designed by Donald Wetzel
Donald C. Wetzel (born January 3, 1929) is an American businessman known for holding the USA patent to the automatic teller machine.
Born in New Orleans, Louisiana, he graduated from Jesuit High School (New Orleans) in 1947 and got a B.Sc. in ...
and his company Docutel. Chemical executives were initially hesitant about the electronic banking transition given the high cost of the early machines. Additionally, executives were concerned that customers would resist having machines handling their money. In 1995, the Smithsonian National Museum of American History
The National Museum of American History: Kenneth E. Behring Center collects, preserves, and displays the heritage of the United States in the areas of social, political, cultural, scientific, and military history. Among the items on display is t ...
recognised Docutel and Wetzel as the inventors of the networked ATM. To show confidence in Docutel, Chemical installed the first four production machines in a marketing test that proved they worked reliably, customers would use them and even pay a fee for usage. Based on this, banks around the country began to experiment with ATM installations.
By 1974, Docutel had acquired 70 percent of the U.S. market; but as a result of the early 1970s worldwide recession and its reliance on a single product line, Docutel lost its independence and was forced to merge with the U.S. subsidiary of Olivetti
Olivetti S.p.A. is an Italian manufacturer of computers, tablets, smartphones, printers and other such business products as calculators and fax machines. Headquartered in Ivrea, in the Metropolitan City of Turin, the company has been part of ...
.
In 1973, Wetzel was grante
U.S. Patent # 3,761,682
the application had been filed in October 1971. However, the U.S. patent record cites at least three previous applications from Docutel, all relevant to the development of the ATM and where Wetzel does not figure, namel
ttp://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sect2=HITOFF&d=PALL&p=1&u=%2Fnetahtml%2FPTO%2Fsrchnum.htm&r=1&f=G&l=50&s1=3651976.PN.&OS=PN/3651976&RS=PN/3651976 U.S. Patent # 3651976an
U.S. Patent # 3,68,569
These patents are all credited to Kenneth S. Goldstein, MR Karecki, TR Barnes, GR Chastian and John D. White.
Further advances
In April 1971, Busicom
was a Japanese company that manufactured and sold computer-related products headquartered in Taito, Tokyo. It owned the rights to Intel's first microprocessor, the Intel 4004, which they created in partnership with Intel in 1970.
Busicom ask ...
began to manufacture ATMs based on the first commercial microprocessor
A microprocessor is a computer processor where the data processing logic and control is included on a single integrated circuit, or a small number of integrated circuits. The microprocessor contains the arithmetic, logic, and control circu ...
, the Intel 4004
The Intel 4004 is a 4-bit central processing unit (CPU) released by Intel Corporation in 1971. Sold for US$60, it was the first commercially produced microprocessor, and the first in a long line of Intel CPUs.
The 4004 was the first signific ...
. Busicom manufactured these microprocessor-based automated teller machines for several buyers, with NCR Corporation
NCR Corporation, previously known as National Cash Register, is an American software, consulting and technology company providing several professional services and electronic products. It manufactures self-service kiosks, point-of-sale termin ...
as the main customer.
Mohamed Atalla
Mohamed M. Atalla ( ar, محمد عطاالله; August 4, 1924 – December 30, 2009) was an Egyptian-American engineer, physicist, cryptographer, inventor and entrepreneur. He was a semiconductor pioneer who made important contributions to ...
invented the first hardware security module
A hardware security module (HSM) is a physical computing device that safeguards and manages secrets (most importantly digital keys), performs encryption and decryption functions for digital signatures, strong authentication and other cryptograp ...
(HSM), dubbed the "Atalla Box", a security system which encrypted PIN
A pin is a device used for fastening objects or material together.
Pin or PIN may also refer to:
Computers and technology
* Personal identification number (PIN), to access a secured system
** PIN pad, a PIN entry device
* PIN, a former Dutch ...
and ATM messages, and protected offline devices with an un-guessable PIN-generating key. In March 1972, Atalla filed for his PIN verification system, which included an encoded card reader
A card reader is a data input device that reads data from a card-shaped storage medium. The first were punched card readers, which read the paper or cardboard punched cards that were used during the first several decades of the computer industry ...
and described a system that utilized encryption
In cryptography, encryption is the process of encoding information. This process converts the original representation of the information, known as plaintext, into an alternative form known as ciphertext. Ideally, only authorized parties can decip ...
techniques to assure telephone link security while entering personal ID information that was transmitted to a remote location for verification.
He founded Atalla Corporation
Utimaco Atalla, founded as Atalla Technovation and formerly known as Atalla Corporation or HP Atalla, is a security vendor, active in the market segments of data security and cryptography. Atalla provides government-grade end-to-end products in ...
(now Utimaco Atalla
Utimaco Atalla, founded as Atalla Technovation and formerly known as Atalla Corporation or HP Atalla, is a security vendor, active in the market segments of data security and cryptography. Atalla provides government-grade end-to-end products in ...
) in 1972, and commercially launched the "Atalla Box" in 1973. The product was released as the Identikey. It was a card reader and customer identification system, providing a terminal with plastic card
A debit card, also known as a check card or bank card is a payment card that can be used in place of cash to make purchases. The term ''#Plastic card, plastic card'' includes the above and as an identity document. These are similar to a credi ...
and PIN capabilities. The Identikey system consisted of a card reader console, two customer PIN pad
A PIN pad or PIN entry device (PED) is an electronic device used in a debit, credit or smart card-based transaction to accept and encrypt the cardholder's personal identification number (PIN).
PIN pads are normally used with payment terminals ...
s, intelligent controller and built-in electronic interface package. The device consisted of two keypads
A keypad is a block or pad of buttons set with an arrangement of digits, symbols, or alphabetical letters. Pads mostly containing numbers and used with computers are numeric keypads. Keypads are found on devices which require mainly numeric inp ...
, one for the customer and one for the teller. It allowed the customer to type in a secret code, which is transformed by the device, using a microprocessor, into another code for the teller. During a transaction, the customer's account number was read by the card reader. This process replaced manual entry and avoided possible key stroke errors. It allowed users to replace traditional customer verification methods such as signature verification and test questions with a secure PIN system. The success of the "Atalla Box" led to the wide adoption of hardware security modules in ATMs. Its PIN verification process was similar to the later IBM 3624
The IBM 3624 was released in 1978 as a second-generation automatic teller machine (ATM), a successor to the IBM 3614. Designed at the IBM Los Gatos lab, the IBM 3624, along with the later IBM 4732 model, was manufactured at IBM facilities in Charlo ...
. Atalla's HSM products protect 250million card transactions every day as of 2013, and secure the majority of the world's ATM transactions as of 2014.
The IBM 2984 was a modern ATM and came into use at Lloyds Bank, High Street, Brentwood, Essex, the UK in December 1972. The IBM 2984 was designed at the request of Lloyds Bank
Lloyds Bank plc is a British retail banking, retail and commercial bank with branches across England and Wales. It has traditionally been considered one of the "Big Four (banking), Big Four" clearing house (finance), clearing banks. Lloyds B ...
. The 2984 Cash Issuing Terminal was a true ATM, similar in function to today's machines and named Cashpoint by Lloyds Bank. Cashpoint is still a registered trademark
The registered trademark symbol, , is a typographic symbol that provides notice that the preceding word or symbol is a trademark or service mark that has been registered with a national trademark office. A trademark is a symbol, word, or word ...
of Lloyds Banking Group in the UK but is often used as a generic trademark
A generic trademark, also known as a genericized trademark or proprietary eponym, is a trademark or brand name that, because of its popularity or significance, has become the generic term for, or synonymous with, a general class of products or ...
to refer to ATMs of all UK banks. All were online and issued a variable amount which was immediately deducted from the account. A small number of 2984s were supplied to a U.S. bank. A couple of well known historical models of ATMs include the Atalla Box
Utimaco Atalla, founded as Atalla Technovation and formerly known as Atalla Corporation or HP Atalla, is a security vendor, active in the market segments of data security and cryptography. Atalla provides government-grade end-to-end products in ...
, IBM 3614, IBM 3624
The IBM 3624 was released in 1978 as a second-generation automatic teller machine (ATM), a successor to the IBM 3614. Designed at the IBM Los Gatos lab, the IBM 3624, along with the later IBM 4732 model, was manufactured at IBM facilities in Charlo ...
and 473x series, Diebold 10xx The Diebold 10xx (or Modular Delivery System, MDS) series is a third and fourth generation family of automated teller machines manufactured by Diebold.
History
Introduced in 1985 as a successor to the TABS 9000 series, the 10xx family of ATMs was r ...
and TABS 9000 series, NCR 1780 and earlier NCR 770 series.
The first switching system to enable shared automated teller machines between banks went into production operation on 3 February 1979, in Denver, Colorado, in an effort by Colorado National Bank of Denver and Kranzley and Company of Cherry Hill, New Jersey.
In 2012, a new ATM at Royal Bank of Scotland
The Royal Bank of Scotland plc (RBS; gd, Banca Rìoghail na h-Alba) is a major retail and commercial bank in Scotland. It is one of the retail banking subsidiaries of NatWest Group, together with NatWest (in England and Wales) and Ulster Bank ...
allowed customers to withdraw cash up to £130 without a card by inputting a six-digit code requested through their smartphones.
Location
ATMs can be placed at any location but are most often placed near or inside banks, shopping centers/malls, airports, railway station
Rail transport (also known as train transport) is a means of transport that transfers passengers and goods on wheeled vehicles running on rails, which are incorporated in tracks. In contrast to road transport, where the vehicles run on a pre ...
s, metro station
A metro station or subway station is a station for a rapid transit system, which as a whole is usually called a "metro" or "subway". A station provides a means for passengers to purchase Train ticket, tickets, board trains, and Emergency eva ...
s, grocery stores, petrol/gas stations, restaurants, and other locations. ATMs are also found on cruise ship
Cruise ships are large passenger ships used mainly for vacationing. Unlike ocean liners, which are used for transport, cruise ships typically embark on round-trip voyages to various ports-of-call, where passengers may go on tours known as "s ...
s and on some US Navy
The United States Navy (USN) is the maritime service branch of the United States Armed Forces and one of the eight uniformed services of the United States. It is the largest and most powerful navy in the world, with the estimated tonnage of ...
ships, where sailors can draw out their pay.
ATMs may be on- and off-premises. On-premises ATMs are typically more advanced, multi-function machines that complement a bank branch's capabilities, and are thus more expensive. Off-premises machines are deployed by financial institutions and independent sales organisations (ISOs) where there is a simple need for cash, so they are generally cheaper single-function devices.
In the US, Canada and some Gulf countries
The Arab states of the Persian Gulf refers to a group of Arab states which border the Persian Gulf. There are seven member states of the Arab League in the region: Bahrain, Kuwait, Iraq, Oman, Qatar, Saudi Arabia, and the United Arab Emirates. ...
, banks may have drive-thru
A drive-through or drive-thru (a sensational spelling of the word ''through''), is a type of take-out service provided by a business that allows customers to purchase products without leaving their cars. The format was pioneered in the Unite ...
lanes providing access to ATMs using an automobile.
In recent times, countries like India and some countries in Africa are installing solar-powered ATMs in rural areas.
The world's highest ATM is located at the Khunjerab Pass
Khunjerab Pass (; ; ug, قونجىراپ ئېغىزى) is a mountain pass in the Karakoram Mountains, in a strategic position on the northern border of Pakistan (Gilgit–Baltistan's Hunza and Nagar Districts) and on the southwest border of Ch ...
in Pakistan
Pakistan ( ur, ), officially the Islamic Republic of Pakistan ( ur, , label=none), is a country in South Asia. It is the world's List of countries and dependencies by population, fifth-most populous country, with a population of almost 24 ...
. Installed at an elevation of by the National Bank of Pakistan
National Bank of Pakistan (NBP) () is a Pakistani government-owned multinational commercial bank which is a subsidiary of State Bank of Pakistan. It is headquartered in Karachi, Pakistan. As of September 2020, it has 1,511 branches across Pakist ...
, it is designed to work in temperatures as low as -40-degree Celsius.
Financial networks
Most ATMs are connected to interbank network
An interbank network, also known as an ATM consortium or ATM network, is a computer network that enables ATM cards issued by a financial institution that is a member of the network to be used to perform ATM transactions through ATMs that belon ...
s, enabling people to withdraw and deposit money from machines not belonging to the bank where they have their accounts or in the countries where their accounts are held (enabling cash withdrawals in local currency). Some examples of interbank networks include NYCE
The New York Currency Exchange (NYCE) is an interbank network connecting the ATMs of various financial institutions in the United States and Canada. NYCE also serves as an EFTPOS network for NYCE-linked ATM cards.
NYCE is based in Secaucus, N ...
, PULSE
In medicine, a pulse represents the tactile arterial palpation of the cardiac cycle (heartbeat) by trained fingertips. The pulse may be palpated in any place that allows an artery to be compressed near the surface of the body, such as at the nec ...
, PLUS
Plus may refer to:
Mathematics
* Addition
* +, the mathematical sign
Music
* ''+'' (Ed Sheeran album), (pronounced "plus"), 2011
* ''Plus'' (Cannonball Adderley Quintet album), 1961
* ''Plus'' (Matt Nathanson EP), 2003
* ''Plus'' (Martin Ga ...
, Cirrus
Cirrus may refer to:
Science
*Cirrus (biology), any of various thin, thread-like structures on the body of an animal
*Cirrus (botany), a tendril
*Infrared cirrus, in astronomy, filamentary structures seen in infrared light
*Cirrus cloud, a type ...
, AFFN
The Armed Forces Financial Network (AFFN) is an interbank network. It provides electronic financial transactions services to the military banking and defense credit union sector. It connects approximately 346 banks and credit unions with over 800, ...
, Interac
Interac is a Canadian interbank network that links financial institutions and other enterprises for the purpose of exchanging electronic financial transactions. Interac serves as the Canadian debit card system and the predominant funds tra ...
, Interswitch, STAR
A star is an astronomical object comprising a luminous spheroid of plasma (physics), plasma held together by its gravity. The List of nearest stars and brown dwarfs, nearest star to Earth is the Sun. Many other stars are visible to the naked ...
, LINK, MegaLink
MegaLink (also spelled Megalink) is a Philippine-based developer of mobile and banking software as well as a service provider for banks, specifically for automatic teller machine networks and point of sale systems of banks in the country. Fro ...
, and BancNet
BancNet (also spelled Bancnet) is a Philippine-based interbank network connecting the Automated teller machine, ATM networks of local and offshore banks, and the country's single interbank network in the Philippines in terms of the number of m ...
.
ATMs rely on the authorization of a financial transaction
A financial transaction is an agreement, or communication, between a buyer and seller to exchange goods, services, or assets for payment. Any transaction involves a change in the status of the finances of two or more businesses or individuals. A ...
by the card issuer or other authorizing institution on a communications network. This is often performed through an ISO 8583
ISO 8583 is an international standard for ''financial transaction card originated'' interchange messaging. It is the International Organization for Standardization standard for systems that exchange electronic transactions initiated by cardholde ...
messaging system.
Many banks charge ATM usage fees. In some cases, these fees are charged solely to users who are not customers of the bank that operates the ATM; in other cases, they apply to all users.
In order to allow a more diverse range of devices to attach to their networks, some interbank networks have passed rules expanding the definition of an ATM to be a terminal that either has the vault within its footprint or utilises the vault or cash drawer within the merchant establishment, which allows for the use of a scrip cash dispenser
An automated teller machine (ATM) or cash machine (in British English) is an electronic telecommunications device that enables customers of financial institutions to perform financial transactions, such as cash withdrawals, deposits, fund ...
.
ATMs typically connect directly to their host or ATM Controller An ATM controller (ATMC) is a system used in financial institutions to route financial transactions between ATMs, core banking systems and other banks. An ATMC is sometimes referred to as an "EFTPOS Switch." An ATM controller is key infrastructur ...
on either ADSL
Asymmetric digital subscriber line (ADSL) is a type of digital subscriber line (DSL) technology, a data communications technology that enables faster data transmission over copper telephone lines than a conventional voiceband modem can provide. ...
or dial-up modem
A modulator-demodulator or modem is a computer hardware device that converts data from a digital format into a format suitable for an analog transmission medium such as telephone or radio. A modem transmits data by Modulation#Digital modulati ...
over a telephone
A telephone is a telecommunications device that permits two or more users to conduct a conversation when they are too far apart to be easily heard directly. A telephone converts sound, typically and most efficiently the human voice, into e ...
line or directly on a leased line. Leased lines are preferable to plain old telephone service
Plain old telephone service (POTS), or plain ordinary telephone system, is a retronym for voice-grade telephone service employing analog signal transmission over copper loops. POTS was the standard service offering from telephone companies from 1 ...
(POTS) lines because they require less time to establish a connection. Less-trafficked machines will usually rely on a dial-up modem on a POTS line rather than using a leased line, since a leased line may be comparatively more expensive to operate compared to a POTS line. That dilemma may be solved as high-speed Internet VPN
A virtual private network (VPN) extends a private network across a public network and enables users to send and receive data across shared or public networks as if their computing devices were directly connected to the private network. The be ...
connections become more ubiquitous. Common lower-level layer communication protocols used by ATMs to communicate back to the bank include SNA over SDLC, TC500 over Async, X.25
X.25 is an ITU-T standard protocol suite for packet-switched data communication in wide area networks (WAN). It was originally defined by the International Telegraph and Telephone Consultative Committee (CCITT, now ITU-T) in a series of drafts ...
, and TCP/IP
The Internet protocol suite, commonly known as TCP/IP, is a framework for organizing the set of communication protocols used in the Internet and similar computer networks according to functional criteria. The foundational protocols in the suit ...
over Ethernet
Ethernet () is a family of wired computer networking technologies commonly used in local area networks (LAN), metropolitan area networks (MAN) and wide area networks (WAN). It was commercially introduced in 1980 and first standardized in 198 ...
.
In addition to methods employed for transaction security and secrecy, all communications traffic between the ATM and the Transaction Processor may also be encrypted using methods such as SSL. 2021
Global use
There are no hard international or government-compiled numbers totaling the complete number of ATMs in use worldwide. Estimates developed by ATMIA
The ATM Industry Association (ATMIA), originally the ATM Owners Association, was established in 1997 in the United States as a global nonprofit trade association to service an industry that built around the global growth of the ATM.
History ...
place the number of ATMs currently in use at 3 million units, or approximately 1 ATM per 3,000 people in the world.
To simplify the analysis of ATM usage around the world, financial institutions generally divide the world into seven regions, based on the penetration rates, usage statistics, and features deployed. Four regions (USA, Canada, Europe, and Japan) have high numbers of ATMs per million people. Despite the large number of ATMs, there is additional demand for machines in the Asia/Pacific area as well as in Latin America. Macau
Macau or Macao (; ; ; ), officially the Macao Special Administrative Region of the People's Republic of China (MSAR), is a city and special administrative region of China in the western Pearl River Delta by the South China Sea. With a pop ...
may have the highest density of ATMs at 254 ATMs per 100,000 adults. ATMs have yet to reach high numbers in the Near East and Africa.
Hardware
An ATM is typically made up of the following devices:
* CPU (to control the user interface and transaction devices)
* Magnetic
Magnetism is the class of physical attributes that are mediated by a magnetic field, which refers to the capacity to induce attractive and repulsive phenomena in other entities. Electric currents and the magnetic moments of elementary particle ...
or chip card
A smart card, chip card, or integrated circuit card (ICC or IC card) is a physical electronic authentication device, used to control access to a resource. It is typically a plastic credit card-sized card with an embedded integrated circuit (IC) c ...
reader (to identify the customer)
* a PIN pad
A PIN pad or PIN entry device (PED) is an electronic device used in a debit, credit or smart card-based transaction to accept and encrypt the cardholder's personal identification number (PIN).
PIN pads are normally used with payment terminals ...
for accepting and encrypting personal identification number
A personal identification number (PIN), or sometimes redundantly a PIN number or PIN code, is a numeric (sometimes alpha-numeric) passcode used in the process of authenticating a user accessing a system.
The PIN has been the key to facilitat ...
EPP4 (similar in layout to a touch tone
Dual-tone multi-frequency signaling (DTMF) is a telecommunication signaling system using the voice-frequency band over telephone lines between telephone equipment and other communications devices and switching centers. DTMF was first developed ...
or calculator
An electronic calculator is typically a portable electronic device used to perform calculations, ranging from basic arithmetic to complex mathematics.
The first solid-state electronic calculator was created in the early 1960s. Pocket-sized ...
keypad), manufactured as part of a secure enclosure
* Secure cryptoprocessor
A secure cryptoprocessor is a dedicated computer-on-a-chip or microprocessor for carrying out cryptographic operations, embedded in a packaging with multiple physical security measures, which give it a degree of tamper resistance. Unlike crypt ...
, generally within a secure enclosure
* Display (used by the customer for performing the transaction)
* Function key
A function key is a key on a computer or terminal keyboard that can be programmed so as to cause an operating system command interpreter or application program to perform certain actions, a form of soft key. On some keyboards/computers, function ...
buttons (usually close to the display) or a touchscreen
A touchscreen or touch screen is the assembly of both an input ('touch panel') and output ('display') device. The touch panel is normally layered on the top of an electronic visual display of an information processing system. The display is often ...
(used to select the various aspects of the transaction)
* Record printer (to provide the customer with a record of the transaction)
* Vault
Vault may refer to:
* Jumping, the act of propelling oneself upwards
Architecture
* Vault (architecture), an arched form above an enclosed space
* Bank vault, a reinforced room or compartment where valuables are stored
* Burial vault (enclosure ...
(to store the parts of the machinery requiring restricted access)
* Housing (for aesthetics and to attach signage to)
* Sensors and indicators
Due to heavier computing demands and the falling price of personal computer
A personal computer (PC) is a multi-purpose microcomputer whose size, capabilities, and price make it feasible for individual use. Personal computers are intended to be operated directly by an end user, rather than by a computer expert or tec ...
–like architectures, ATMs have moved away from custom hardware architectures using microcontrollers or application-specific integrated circuits and have adopted the hardware architecture of a personal computer, such as USB connections for peripherals, Ethernet and IP communications, and use personal computer operating systems.
Business owners often lease ATMs from service providers. However, based on the economies of scale, the price of equipment has dropped to the point where many business owners are simply paying for ATMs using a credit card.
New ADA voice and text-to-speech guidelines imposed in 2010, but required by March 2012 have forced many ATM owners to either upgrade non-compliant machines or dispose them if they are not upgradable, and purchase new compliant equipment. This has created an avenue for hackers and thieves to obtain ATM hardware at junkyards from improperly disposed decommissioned machines.
The vault of an ATM is within the footprint of the device itself and is where items of value are kept. Scrip cash dispensers, which print a receipt or scrip instead of cash, do not incorporate a vault.
Mechanisms found inside the vault may include:
* Dispensing mechanism (to provide cash
In economics, cash is money in the physical form of currency, such as banknotes and coins.
In bookkeeping and financial accounting, cash is current assets comprising currency or currency equivalents that can be accessed immediately or near-imm ...
or other items of value)
* Deposit mechanism including a cheque processing module and bulk note acceptor (to allow the customer to make deposits)
* Security sensors (magnetic, thermal, seismic, gas)
* Locks (to control access to the contents of the vault)
* Journaling systems; many are electronic (a sealed flash memory device based on in-house standards) or a solid-state device (an actual printer) which accrues all records of activity including access timestamps, number of notes dispensed, etc. This is considered sensitive data and is secured in similar fashion to the cash as it is a similar liability.
ATM vaults are supplied by manufacturers in several grades. Factors influencing vault grade selection include cost, weight, regulatory requirements, ATM type, operator risk avoidance practices and internal volume requirements. Industry standard vault configurations include Underwriters Laboratories UL-291 "Business Hours" and Level 1 Safes, RAL TL-30 derivatives, and CEN EN 1143-1 - CEN III and CEN IV.
ATM manufacturers recommend that a vault be attached to the floor to prevent theft, though there is a record of a theft conducted by tunnelling into an ATM floor.
Software
With the migration to commodity Personal Computer hardware, standard commercial "off-the-shelf" operating systems and programming environments can be used inside of ATMs. Typical platforms previously used in ATM development include RMX (operating system), RMX or OS/2.
Today, the vast majority of ATMs worldwide use Microsoft Windows. In early 2014, 95% of ATMs were running Windows XP. A small number of deployments may still be running older versions of the Windows OS, such as Windows NT, Windows CE, or Windows 2000, even though Microsoft still supports only Windows 8.1, Windows 10 and Windows 11.
There is a computer industry security view that general public desktop operating systems(os) have greater risks as operating systems for cash dispensing machines than other types of operating systems like (secure) real-time operating systems (RTOS). RISKS Digest has many articles about ATM operating system vulnerabilities.
Linux is also finding some reception in the ATM marketplace. An example of this is Banrisul, the largest bank in the south of Brazil, which has replaced the MS-DOS operating systems in its ATMs with Linux. Banco do Brasil is also migrating ATMs to Linux. Indian-based Vortex Engineering is manufacturing ATMs that operate only with Linux.
Common application layer transaction protocols, such as Diebold 91x (911 or 912) and NCR Corporation, NCR NDC or NDC+ provide Hardware emulation, emulation of older generations of hardware on newer platforms with incremental extensions made over time to address new capabilities, although companies like NCR continuously improve these protocols issuing newer versions (e.g. NCR's AANDC v3.x.y, where x.y are subversions). Most major ATM manufacturers provide software packages that implement these protocols. Newer protocols such as IFX have yet to find wide acceptance by transaction processors.
With the move to a more standardised software base, financial institutions have been increasingly interested in the ability to pick and choose the application programs that drive their equipment. WOSA/XFS, now known as CEN/XFS, CEN XFS (or simply XFS), provides a common API for accessing and manipulating the various devices of an ATM. J/XFS is a Java implementation of the CEN XFS API.
While the perceived benefit of XFS is similar to the Java's "write once, run anywhere" mantra, often different ATM hardware vendors have different interpretations of the XFS standard. The result of these differences in interpretation means that ATM applications typically use a middleware to even out the differences among various platforms.
With the onset of Windows operating systems and XFS on ATMs, the software applications have the ability to become more intelligent. This has created a new breed of ATM applications commonly referred to as programmable applications. These types of applications allows for an entirely new host of applications in which the ATM terminal can do more than only communicate with the ATM switch. It is now empowered to connected to other content servers and video banking systems.
Notable ATM software that operates on XFS platforms include Triton PRISM, Diebold Agilis EmPower, NCR Corporation, NCR APTRA Edge, Absolute Systems AbsoluteINTERACT, KAL (Korala Associates Limited), KAL Kalignite Software Platform, Phoenix Interactive VISTAatm, Wincor Nixdorf, Wincor Nixdorf ProTopas, Euronet Worldwide, Euronet EFTS and Intertech inter-ATM.
With the move of ATMs to industry-standard computing environments, concern has risen about the integrity of the ATM's software stack.
Impact on labor
The number of human bank tellers in the United States increased from approximately 300,000 in 1970 to approximately 600,000 in 2010. Counter-intuitively, a contributing factor may be the introduction of automated teller machines. ATMs let a branch operate with fewer tellers, making it cheaper for banks to open more branches. This likely resulted in more tellers being hired to handle non-automated tasks, but further automation and online banking may reverse this increase.
Security
Security, as it relates to ATMs, has several dimensions. ATMs also provide a practical demonstration of a number of security systems and concepts operating together and how various security concerns are addressed.
Physical
Early ATM security focused on making the terminals invulnerable to physical attack; they were effectively safes with dispenser mechanisms. A number of attacks resulted, with thieves attempting to steal entire machines by ram-raiding. Since the late 1990s, criminal groups operating in Japan improved ram-raiding by stealing and using a truck loaded with heavy construction machinery to effectively demolish or uproot an entire ATM and any housing to steal its cash.
Another attack method, ''plofkraak'', is to seal all openings of the ATM with silicone and fill the vault with a combustible gas or to place an explosive inside, attached, or near the machine. This gas or explosive is ignited and the vault is opened or distorted by the force of the resulting explosion and the criminals can break in. This type of theft has occurred in the Netherlands, Belgium, France, Denmark, Germany, Australia
Australia, officially the Commonwealth of Australia, is a Sovereign state, sovereign country comprising the mainland of the Australia (continent), Australian continent, the island of Tasmania, and numerous List of islands of Australia, sma ...
, and the United Kingdom. These types of attacks can be prevented by a number of gas explosion prevention devices also known as gas suppression system. These systems use explosive gas detection sensor to detect explosive gas and to neutralise it by releasing a special explosion suppression chemical which changes the composition of the explosive gas and renders it ineffective.
Several attacks in the UK (at least one of which was successful) have involved digging a concealed tunnel under the ATM and cutting through the reinforced base to remove the money.
Modern ATM physical security, per other modern money-handling security, concentrates on denying the use of the money inside the machine to a thief, by using different types of Intelligent banknote neutralisation system, Intelligent Banknote Neutralisation Systems.
A common method is to simply rob the staff filling the machine with money. To avoid this, the schedule for filling them is kept secret, varying and random. The money is often kept in cassettes, which will dye the money if incorrectly opened.
Transactional secrecy and integrity
The security of ATM transactions relies mostly on the integrity of the secure cryptoprocessor: the ATM often uses general commodity components that sometimes are not considered to be "trusted systems".
Encryption of personal information, required by law in many jurisdictions, is used to prevent fraud. Sensitive data in ATM transactions are usually encryption, encrypted with Data Encryption Standard, DES, but transaction processors now usually require the use of Triple DES. Remote Key Loading techniques may be used to ensure the secrecy of the initialisation of the encryption keys in the ATM. Message Authentication Code (MAC) or Partial MAC may also be used to ensure messages have not been tampered with while in transit between the ATM and the financial network.
Customer identity integrity
There have also been a number of incidents of fraud by Man-in-the-middle attacks, where criminals have attached fake keypads or card readers to existing machines. These have then been used to record customers' PINs and bank card information in order to gain unauthorised access to their accounts. Various ATM manufacturers have put in place countermeasures to protect the equipment they manufacture from these threats.
Alternative methods to verify cardholder identities have been tested and deployed in some countries, such as finger and palm vein patterns, Iris recognition, iris, and facial recognition system, facial recognition technologies. Cheaper mass-produced equipment has been developed and is being installed in machines globally that detect the presence of foreign objects on the front of ATMs, current tests have shown 99% detection success for all types of Skimming (credit card fraud), skimming devices.
Device operation integrity
Openings on the customer side of ATMs are often covered by mechanical shutters to prevent tampering with the mechanisms when they are not in use. Alarm sensors are placed inside ATMs and their servicing areas to alert their operators when doors have been opened by unauthorised personnel.
To protect against hackers, ATMs have a built-in firewall. Once the firewall has detected malicious attempts to break into the machine remotely, the firewall locks down the machine.
Rules are usually set by the government or ATM operating body that dictate what happens when integrity systems fail. Depending on the jurisdiction, a bank may or may not be liable when an attempt is made to dispense a customer's money from an ATM and the money either gets outside of the ATM's vault, or was exposed in a non-secure fashion, or they are unable to determine the state of the money after a failed transaction. Customers often commented that it is difficult to recover money lost in this way, but this is often complicated by the policies regarding suspicious activities typical of the criminal element.
Customer security
In some countries, multiple security cameras and security guards are a common feature. In the United States, The New York State Comptroller's Office has advised the New York State Department of Banking to have more thorough safety inspections of ATMs in high crime areas.
Consultants of ATM operators assert that the issue of customer security should have more focus by the banking industry; it has been suggested that efforts are now more concentrated on the preventive measure of deterrent legislation than on the problem of ongoing forced withdrawals.
At least as far back as 30 July 1986, consultants of the industry have advised for the adoption of an emergency PIN system for ATMs, where the user is able to send a panic alarm, silent alarm in response to a threat. Legislative efforts to require an emergency PIN system have appeared in Illinois, Kansas and Georgia (U.S. state), Georgia, but none has succeeded yet. In January 2009, Senate Bill 1355 was proposed in the Illinois Senate that revisits the issue of the reverse emergency PIN system. The bill is again supported by the police and opposed by the banking lobby.
In 1998, three towns outside Cleveland, Ohio, in response to an ATM crime wave, adopted legislation requiring that an emergency telephone number switch be installed at all outdoor ATMs within their jurisdiction. In the wake of a homicide in Sharon Hill, Pennsylvania, the city council passed an ATM security bill as well.
In China and elsewhere, many efforts to promote security have been made. On-premises ATMs are often located inside the bank's lobby, which may be accessible 24 hours a day. These lobbies have extensive security camera coverage, a courtesy telephone for consulting with the bank staff, and a security guard on the premises. Bank lobbies that are not guarded 24 hours a day may also have secure doors that can only be opened from outside by swiping the bank card against a wall-mounted scanner, allowing the bank to identify which card enters the building. Most ATMs will also display on-screen safety warnings and may also be fitted with convex mirrors above the display allowing the user to see what is happening behind them.
As of 2013, the only claim available about the extent of ATM-connected homicides is that they range from 500 to 1,000 per year in the US, covering only cases where the victim had an ATM card and the card was used by the killer after the known time of death.
Jackpotting
The term is used to describe one method criminals utilize to steal money from an ATM. The thieves gain physical access through a small hole drilled in the machine. They disconnect the existing hard drive and connect an external drive using an industrial endoscope. They then depress an internal button that reboots the device so that it is now under the control of the external drive. They can then have the ATM dispense all of its cash.
Encryption
In recent years, many ATMs also encrypt the hard disk. This means that actually creating the software for jackpotting is more difficult, and provides more security for the ATM.
Uses
ATMs were originally developed as cash dispensers, and have evolved to provide many other bank-related functions:
* Paying routine bills, fees, and taxes (utilities, phone bills, social security, legal fees, income taxes, etc.)
* Printing or ordering bank statements
* Updating passbooks
* Cash advances
* Cheque Processing Module
* Paying (in full or partially) the credit balance on a card linked to a specific Current account (banking), current account.
* Transferring money between linked accounts (such as transferring between accounts)
* Deposit currency recognition, acceptance, and recycling
In some countries, especially those which benefit from a fully integrated cross-bank network (e.g.: Multibanco in Portugal), ATMs include many functions that are not directly related to the management of one's own bank account, such as:
* Loading monetary value into stored-value cards
* Adding pre-paid cell phone / mobile phone credit.
* Purchasing
** Concert tickets
** Gold
** Lottery tickets
** Movie tickets
** Postage stamps.
** Public transport#Ticket systems, Train tickets
** Shopping mall gift certificates.
* Donating to charities
Increasingly, banks are seeking to use the ATM as a sales device to deliver pre approved loans and targeted advertising using products such as ITM (the Intelligent Teller Machine) from Aptra Relate from NCR. ATMs can also act as an advertising channel for other companies.*
However, several different ATM technologies have not yet reached worldwide acceptance, such as:
* Videoconferencing with human tellers, known as video tellers
* Biometrics, where authorization of transactions is based on the scanning of a customer's fingerprint, iris, face, etc.
* Cheque/cash Acceptance, where the machine accepts and recognises cheques and/or currency without using envelopes Expected to grow in importance in the US through Check 21 legislation.
* Barcode reader, Bar code scanning
* On-demand printing of "items of value" (such as movie tickets, traveler's cheques, etc.)
* Dispensing additional media (such as phone cards)
* Co-ordination of ATMs with mobile phones
* Integration with non-banking equipment
* Games and promotional features
* Customer relationship management, CRM through the ATM
Videoconferencing teller machines are currently referred to as Interactive Teller Machines. Benton Smith writes in the Idaho Business Review, "The software that allows interactive teller machines to function was created by a Salt Lake City-based company called uGenius, a producer of video banking software. NCR, a leading manufacturer of ATMs, acquired uGenius in 2013 and married its own ATM hardware with uGenius' video software."
*Pharmacy dispensing units
Reliability
Before an ATM is placed in a public place, it typically has undergone extensive testing with both Test Money, test money and the Front and back ends, backend computer systems that allow it to perform transactions. Banking customers also have come to expect high reliability in their ATMs, which provides incentives to ATM providers to minimise machine and network failures. Financial consequences of incorrect machine operation also provide high degrees of incentive to minimise malfunctions.
ATMs and the supporting electronic financial networks are generally very reliable, with industry benchmarks typically producing 98.25% customer availability for ATMs and up to 99.999% availability for host systems that manage the networks of ATMs. If ATM networks do go out of service, customers could be left without the ability to make transactions until the beginning of their bank's next time of opening hours.
This said, not all errors are to the detriment of customers; there have been cases of machines giving out money without debiting the account, or giving out higher value notes as a result of incorrect denomination (currency), denomination of banknote being loaded in the money cassettes. The result of receiving too much money may be influenced by the card holder agreement in place between the customer and the bank.
Errors that can occur may be Machine, mechanical (such as card transport mechanisms; keypads; hard disk failures; envelope deposit mechanisms); software (such as operating system; device driver; application software, application); information transfer, communications; or purely down to operator error.
To aid in reliability, some ATMs print each transaction to a roll-paper journal that is stored inside the ATM, which allows its users and the related financial institutions to settle things based on the records in the journal in case there is a dispute. In some cases, transactions are posted to an electronic journal to remove the cost of supplying journal paper to the ATM and for more convenient searching of data.
Improper money checking can cause the possibility of a customer receiving counterfeit banknotes from an ATM. While bank personnel are generally trained better at spotting and removing counterfeit cash, the resulting ATM money supplies used by banks provide no guarantee for proper banknotes, as the Federal Criminal Police Office (Germany), Federal Criminal Police Office of Germany has confirmed that there are regularly incidents of false banknotes having been dispensed through ATMs. Some ATMs may be stocked and wholly owned by outside companies, which can further complicate this problem.
Bill validator, Bill validation technology can be used by ATM providers to help ensure the authenticity of the cash before it is stocked in the machine; those with cash recycling capabilities include this capability.
In India, whenever a transaction fails with an ATM due to network or technical issues and if the amount does not get dispensed in spite of the account being debited then the banks are supposed to return the debited amount to the customer within seven working days from the day of receipt of a complaint. Banks are also liable to pay the late fees in case of delay in repayment of funds post seven days.
Fraud
As with any device containing objects of value, ATMs and the systems they depend on to function are the targets of fraud. Fraud against ATMs and people's attempts to use them takes several forms.
The first known instance of a fake ATM was installed at a shopping mall in Manchester, Connecticut, in 1993. By modifying the inner workings of a Fujitsu model 7020 ATM, a criminal gang known as the Bucklands Boys stole information from cards inserted into the machine by customers.
WAVY-TV reported an incident in Virginia Beach in September 2006 where a hacker, who had probably obtained a factory-default administrator password for a filling station's white-label ATM, caused the unit to assume it was loaded with US$5 bills instead of $20s, enabling himself—and many subsequent customers—to walk away with four times the money withdrawn from their accounts. This type of scam was featured on the TV series ''The Real Hustle''.
ATM behaviour can change during what is called "stand-in" time, where the bank's cash dispensing network is unable to access databases that contain account information (possibly for database maintenance). In order to give customers access to cash, customers may be allowed to withdraw cash up to a certain amount that may be less than their usual daily withdrawal limit, but may still exceed the amount of available money in their accounts, which could result in fraud if the customers intentionally withdraw more money than they had in their accounts.
Card fraud
In an attempt to prevent criminals from shoulder surfing (computer security), shoulder surfing the customer's personal identification number
A personal identification number (PIN), or sometimes redundantly a PIN number or PIN code, is a numeric (sometimes alpha-numeric) passcode used in the process of authenticating a user accessing a system.
The PIN has been the key to facilitat ...
(PIN), some banks draw privacy areas on the floor.
For a low-tech form of fraud, the easiest is to simply steal a customer's card along with its PIN. A later variant of this approach is to trap the card inside of the ATM's card reader with a device often referred to as a Lebanese loop. When the customer gets frustrated by not getting the card back and walks away from the machine, the criminal is able to remove the card and withdraw cash from the customer's account, using the card and its PIN.
This type of fraud has spread globally. Although somewhat replaced in terms of volume by skimming incidents, a re-emergence of card trapping has been noticed in regions such as Europe, where EMV chip and PIN cards have increased in circulation.
Another simple form of fraud involves attempting to get the customer's bank to issue a new card and its PIN and stealing them from their mail.
By contrast, a newer high-tech method of operating, sometimes called card skimming or card cloning, involves the installation of a magnetic card reader over the real ATM's card slot and the use of a wireless surveillance camera or a modified digital camera or a false PIN keypad to observe the user's PIN. Card data is then cloned into a duplicate card and the criminal attempts a standard cash withdrawal. The availability of low-cost commodity wireless cameras, keypads, card readers, and card writers has made it a relatively simple form of fraud, with comparatively low risk to the fraudsters.
In an attempt to stop these practices, countermeasures against card cloning have been developed by the banking industry, in particular by the use of smart cards which cannot easily be copied or spoofed by unauthenticated devices, and by attempting to make the outside of their ATMs tamper-evident, tamper evident. Older chip-card security systems include the French Carte Bleue, Visa Cash, Mondex, Blue from American Express and EMV 96, EMV '96 or EMV 3.11. The most actively developed form of smart card security in the industry today is known as EMV 2000, EMV 2000 or EMV 4.x.
EMV is widely used in the UK (Chip and PIN) and other parts of Europe, but when it is not available in a specific area, ATMs must fall back to using the easy–to–copy magnetic stripe to perform transactions. This fallback behaviour can be exploited. However, the fallback option has been removed on the ATMs of some UK banks, meaning if the chip is not read, the transaction will be declined.
Card cloning and Skimming (credit card fraud), skimming can be detected by the implementation of magnetic card reader heads and firmware that can read a signature embedded in all magnetic stripes during the card production process. This signature, known as a "MagnePrint" or "BluPrint", can be used in conjunction with common two-factor authentication schemes used in ATM, debit/retail point-of-sale and prepaid card applications.
The concept and various methods of copying the contents of an ATM card's magnetic stripe onto a duplicate card to access other people's financial information were well known in the hacking communities by late 1990.
In 1996, Andrew Stone, a computer security consultant from Hampshire in the UK, was convicted of stealing more than £1 million by pointing high-definition video cameras at ATMs from a considerable distance and recording the card numbers, expiry dates, etc. from the embossed detail on the ATM cards along with video footage of the PINs being entered. After getting all the information from the videotapes, he was able to produce clone cards which not only allowed him to withdraw the full daily limit for each account, but also allowed him to sidestep withdrawal limits by using multiple copied cards. In court, it was shown that he could withdraw as much as £10,000 per hour by using this method. Stone was sentenced to five years and six months in prison.
Related devices
A talking ATM is a type of ATM that provides audible instructions so that people who cannot read a screen can independently use the machine, therefore effectively eliminating the need for assistance from an external, potentially malevolent source. All audible information is delivered privately through a standard headphone jack on the face of the machine. Alternatively, some banks such as the Nordea and Swedbank use a built-in external speaker which may be invoked by pressing the talk button on the keypad. Information is delivered to the customer either through pre-recorded sound files or via text-to-speech speech synthesis.
A postal interactive kiosk may share many components of an ATM (including a vault), but it only dispenses items related to postage.
A scrip cash dispenser may have many components in common with an ATM, but it lacks the ability to dispense physical cash and consequently requires no vault. Instead, the customer requests a withdrawal transaction from the machine, which prints a receipt or scrip. The customer then takes this receipt to a nearby sales clerk, who then exchanges it for cash from the till.
A teller assist unit (TAU) is distinct in that it is designed to be operated solely by trained personnel and not by the general public, does integrate directly into interbank networks, and usually is controlled by a computer that is not directly integrated into the overall construction of the unit.
A Web ATM is an online interface for ATM card banking that uses a Card reader#Smart card readers, smart card reader. All the usual ATM functions are available, except for withdrawing cash. Most banks in Taiwan provide these online services.
See also
* ATM Industry Association (ATMIA)
* Automated cash handling
* Banknote counter
* Bitcoin ATM
* Cash register
* EFTPOS
* Electronic funds transfer
* Financial cryptography
* Key management
* Payroll
* Phantom withdrawal
* RAS syndrome
* Self service
* Teller system
* Verification and validation
References
Further reading
* Ali, Peter Ifeanyichukwu. "Impact of automated teller machine on banking services delivery in Nigeria: a stakeholder analysis." ''Brazilian Journal of Education, Technology and Society'' 9.1 (2016): 64–72
online
* Bátiz-Lazo, Bernardo. ''Cash and Dash: How ATMs and Computers Changed Banking'' (Oxford University Press, 2018)
online review
* Batiz-Lazo, Bernardo. "Emergence and evolution of ATM networks in the UK, 1967–2000." ''Business History'' 51.1 (2009): 1-27
online
* Batiz-Lazo, Bernardo, and Gustavo del Angel. ''The Dawn of the Plastic Jungle: The Introduction of the Credit Card in Europe and North America, 1950-1975'' (Hoover Institution, 2016)
* Bessen, J. ''Learning by Doing: The Real Connection between Innovation, Wages, and Wealth'' (Yale UP, 2015)
* Hota, Jyotiranjan, Saboohi Nasim, and Sasmita Mishra. "Drivers and Barriers to Adoption of Multivendor ATM Technology in India: Synthesis of Three Empirical Studies." ''Journal of Technology Management for Growing Economies'' 9.1 (2018): 89-102
online
* McDysan, David E., and Darren L. Spohn. ''ATM theory and applications'' (McGraw-Hill Professional, 1998).
* Mkpojiogu, Emmanuel OC, and A. Asuquo. "The user experience of ATM users in Nigeria: a systematic review of empirical papers." ''Journal of Research in National Development'' (2018)
online
Primary sources
External links
An account of US cash machine history; By Ellen Florian, Fortune magazine, Fortune.com
*
World Map and Chart of Automated Teller Machines per 100,000 Adults
by Lebanese-economy-forum, World Bank data
{{Authority control
Automated teller machines,
Computer-related introductions in 1967
Banking equipment
Banking technology
Embedded systems
American inventions
English inventions
Payment systems
Articles containing video clips
1967 in economics
20th-century inventions