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Automated teller machine

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“Cash machine” redirects here. For the song, see Cash Machine.

An NCR Personas 85-Series interior, multi-function ATM in the USA

Smaller indoor ATMs dispense money inside convenience stores and other busy areas,
such as this off-premise Wincor Nixdorf mono-function ATM in Sweden.

An automated teller machine (ATM) is a computerized telecommunications device that


provides the customers of a financial institution with access to financial transactions in a
public space without the need for a human clerk or bank teller. On most modern ATMs,
the customer is identified by inserting a plastic ATM card with a magnetic stripe or a
plastic smartcard with a chip, that contains a unique card number and some security
information, such as an expiration date or CVC (CVV). Security is provided by the
customer entering a personal identification number (PIN).

Using an ATM, customers can access their bank accounts in order to make cash
withdrawals (or credit card cash advances) and check their account balances. Many
ATMs also allow people to deposit cash or checks, transfer money between their bank
accounts, pay bills, or purchase goods and services.

ATMs are known by various casual terms including automated banking machine, cash
machine, hole-in-the-wall, cashpoint or Bancomat (in Europe and Russia). The
occasionally-used term ATM machine is an example of RAS syndrome.

Contents
[hide]

• 1 History
• 2 Location
• 3 Financial networks
• 4 Global use
• 5 Hardware
o 5.1 Vaults
• 6 Software
• 7 Security
o 7.1 Physical
o 7.2 Transactional secrecy and integrity
o 7.3 Customer identity integrity
o 7.4 Device operation integrity
o 7.5 Customer security
• 8 Alternative uses
• 9 Reliability
• 10 Fraud
o 10.1 Card fraud
• 11 Related devices
• 12 See also
• 13 References

• 14 External links

[edit] History
An old Nixdorf ATM

A mechanical cash dispenser was developed and built by Luther George Simjian and
installed 1939 in New York City by the City Bank of New York, but removed after 6
months due to the lack of customer acceptance.[1]

Thereafter, the history of ATMs paused for over 25 years, until De La Rue developed the
first electronic ATM, which was installed first in Enfield Town in North London[2] on 27
June 1967 by Barclays Bank.[3]. This instance of the invention is credited to John
Shepherd-Barron, although various other engineers were awarded patents for related
technologies at the time.[4] Shepherd-Barron was awarded an OBE in the 2005 New
Year's Honours List.[5] The first person to use the machine was Reg Varney of "On the
Buses" fame, a British Television programme from the 1960s.[6] The first ATMs accepted
only a single-use token or voucher, which was retained by the machine. These worked on
various principles including radiation and low-coercivity magnetism that was wiped by
the card reader to make fraud more difficult.[4] The idea of a PIN stored on the card was
developed by the British engineer John Rose in 1965.[4]

ATMs first came into wide UK use in 1973; the IBM 2984 was designed at the request of
Lloyds Bank. The 2984 CIT (Cash Issuing Terminal) was the first true Cashpoint, similar
in function to today's machines; Cashpoint is still a registered trademark of Lloyds TSB
in the U.K. All were online and issued a variable amount which was immediately
deducted from the account. A small number of 2984s were supplied to a USA bank.
Notable historical models of ATMs include the IBM 3624 and 473x series, Diebold 10xx
and TABS 9000 series, and NCR 5xxx series.

[edit] Location
An ATM Encrypting PIN Pad (EPP) with German markings

ATMs are placed not only near or inside the premises of banks, but also in locations such
as shopping centers/malls, airports, grocery stores, petrol/gas stations, restaurants, or any
place large numbers of people may gather. These represent two types of ATM
installations: on and off premise. On premise ATMs are typically more advanced, multi-
function machines that complement an actual bank branch's capabilities and thus more
expensive. Off premise machines are deployed by financial institutions and also ISOs (or
Independent Sales Organizations) where there is usually just a straight need for cash, so
they typically are the cheaper mono-function devices. In Canada, when an ATM is not
operated by a financial institution it is known as a "White Label ATM".

In North America, banks often have drive-through lanes providing access to ATMs.

[edit] Financial networks

An ATM in the Netherlands. The logos of a number of interbank networks this ATM is
connected to are shown.

Most ATMs are connected to interbank networks, enabling people to withdraw and
deposit money from machines not belonging to the bank where they have their account or
in the country where their accounts are held (enabling cash withdrawals in local
currency). Some examples of interbank networks include PLUS, Cirrus, Interac and
LINK.

ATMs rely on authorization of a financial transaction by the card issuer or other


authorizing institution via the communications network. This is often performed through
an ISO 8583 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 where the ATM is installed; in other cases, they
apply to all users. Many people oppose these fees because ATMs are actually less costly
for banks than withdrawals from human tellers.

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 utilizes the vault or cash drawer
within the merchant establishment, which allows for the use of a scrip cash dispenser.

A Diebold 1063ix with a dial-up modem visible at the base

ATMs typically connect directly to their ATM Transaction Processor via either a dial-up
modem over a telephone line or directly via a leased line. Leased lines are preferable to
POTS lines because they require less time to establish a connection. Leased lines may be
comparatively expensive to operate versus a POTS line, meaning less-trafficked
machines will usually rely on a dial-up modem. That dilemma may be solved as high-
speed Internet VPN 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, and TCP/IP over Ethernet.

In addition to methods employed for transaction security and secrecy, all communications
traffic between the ATM and the Transaction Processor may also be encrypted via
methods such as SSL.[7]

[edit] Global use

An ATM in the Tokyo subway


There are no hard international or government-compiled numbers totaling the complete
number of ATMs in use worldwide. Estimates developed by ATMIA place the number of
ATMs in use at over 1.5 million as of August 2006.[8]

Industry views of ATM usage around the world generally divide the world into seven
regions, due to the penetration rates, usage statistics, and features deployed. Four regions
(USA, Canada, Europe, and Japan) have high numbers of ATMs per million people[9] and
generally slowing growth rates.[10] Despite the large number of ATMs,[11] there is
additional demand for machines in the Asia/Pacific area as well as in Latin America.[12]
ATMs have yet to reach high numbers in the Near East/Africa.[13]

The world's most northerly installed ATM is located at Longyearbyen, Svalbard,


Norway.[14]

The world's most southerly installed ATM is located at McMurdo Station, Antarctica.[15]

While ATMs are ubiquitous on modern cruise ships, ATMs can also be found on some
US Navy ships.[16]

[edit] Hardware

A block diagram of an ATM.

An ATM is typically made up of the following devices:

• CPU (to control the user interface and transaction devices)


• Magnetic and/or Chip card reader (to identify the customer)
• PIN Pad (similar in layout to a Touch tone or Calculator keypad), often
manufactured as part of a secure enclosure.
• Secure cryptoprocessor, generally within a secure enclosure.
• Display (used by the customer for performing the transaction)
• Function key buttons (usually close to the display) or a Touchscreen (used to
select the various aspects of the transaction)
• Record Printer (to provide the customer with a record of their transaction)
• Vault (to store the parts of the machinery requiring restricted access)
• Housing (for aesthetics and to attach signage to)

Recently, due to heavier computing demands and the falling price of computer-like
architectures, ATMs have moved away from custom hardware architectures using
microcontrollers and/or application-specific integrated circuits to adopting a hardware
architecture that is very similar to a personal computer. Many ATMs are now able to use
operating systems such as Microsoft Windows and Linux. Although it is undoubtedly
cheaper to use commercial off-the-shelf hardware, it does make ATMs vulnerable to the
same sort of problems exhibited by conventional computers.

[edit] Vaults

Interior of an NCR Personas 70 freestanding ATM, during servicing

The vault of an ATM is within the footprint of the device itself and is where items of
value are kept. Scrip cash dispensers do not incorporate a vault.

Mechanisms found inside the vault may include:

• Dispensing mechanism (to provide cash or other items of value)


• Deposit mechanism, including a Cheque Processing Module and Batch Note
Acceptor (to allow the customer to make deposits)
• Security sensors (Magnetic, Thermal, Seismic)
• Locks: (to ensure controlled access to the contents of the vault)
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.[17]

Industry standard vault configurations include Underwriters Laboratories UL-291


"Business Hours" and Level 1 Safes,[18] RAL 626/3,[19][20] TL-30 derivatives,[21] and CEN
EN 1143-1:2005 - CEN III/VdS and CEN IV/LGAI/VdS.[22][23]

ATM manufacturers recommend that vaults be attached to the floor to prevent theft.[24]

[edit] Software

A Wincor Nixdorf ATM running Windows 2000

With the migration to commodity PC hardware, standard commercial "off-the-shelf"


operating systems and programming environments can be used inside of ATMs. Typical
platforms used in ATM development include RMX, OS/2, and Microsoft operating
systems (such as Windows NT, Windows 2000, Windows XP, or Windows XP
Embedded). Sun Microsystem's Java may also be used in these environments.

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.

Common application layer transaction protocols, such as Diebold 911 or 912, IBM PBM,
and NCR NDC or NDC+ provide emulation of older generations of hardware on newer
platforms with incremental extensions made over time to address new capabilities. 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.
[25]

With the move to a more standardized 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 (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.[26]


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 between various platforms.

Notable XFS middleware platforms include Triton PRISM, Diebold Agilis, KAL
Kalignite, NCR Corporation Aptra Edge, Phoenix Interactive VISTAatm, and Wincor
Nixdorf Protopas.

With the move of ATMs to industry-standard computing environments, concern has risen
about the integrity of the ATM's software stack.[27]

[edit] Security

An ATM with card reader and PIN keypad.

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 dealt with.

[edit] Physical

This is a Wincor Nixdorf Procash 2100xe Frontload that was opened with an angle
grinder.
Early ATM security focused on making the ATMs invulnerable to physical attack; they
were effectively safes with dispenser mechanisms. A number of attacks on ATMs
resulted, with thieves attempting to steal entire ATMs by ram-raiding.[28] Since late
1990s, criminal groups operating in Japan improved ram-raiding by stealing and using a
truck loaded with a heavy construction machinery to effectively demolish or uproot an
entire ATM and any housing to steal its cash.[29]

Another attack method 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 ATM. 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.

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 means of techniques
such as dye markers and smoke canisters.[30]

[edit] Transactional secrecy and integrity

The security of ATM transactions relies mostly on the integrity of the secure
cryptoprocessor: the ATM often uses commodity components that 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 encrypted with DES, but
transaction processors now usually require the use of Triple DES.[31] Remote Key
Loading techniques may be used to ensure the secrecy of the initialization 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.

[edit] Customer identity integrity

A BTMU ATM with a palm scanner (to the right of the screen)

There have also been a number of incidents of fraud 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.[32][33]

Alternate methods to verify cardholder identities have been tested and deployed in some
countries, such as finger and palm vein patterns,[34] iris, and facial recognition
technologies. Cost of integrating and implementing these technologies along with
concerns about consumer acceptance have limited their deployment so far.[35]

[edit] Device operation integrity

ATMs that are exposed to the outside must be vandal and weather resistant.

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 the ATM and in ATM servicing areas to alert their operators when doors
have been opened by unauthorized personnel.

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.
[36]
Bank customers often complain that banks have made it difficult to recover money
lost in this way, but this is often complicated by the Bank's own internal policies
regarding suspicious activities typical of the criminal element.[37]

[edit] Customer security

Security guards watching over ATMs that have been installed in a van.

In some areas, multiple security cameras and security guards are an ubiquitous ATM
feature.[38]
Critics of ATM operators assert that the issue of customer security appears to have been
abandoned by the banking industry;[39] it has been suggested that efforts are now more
concentrated on deterring legislation than on solving the problem of forced withdrawals.
[40]

At least as far back as July 30, 1986, critics of the industry have called for the adoption of
an emergency PIN system for ATMs, where the user is able to send a silent alarm in
response to a threat.[41] Legislative efforts to require an emergency PIN system have
appeared in Illinois,[42] Kansas[43] and Georgia,[44] but none have succeeded as of yet.

[edit] Alternative uses

Two NCR Personas 84 ATMs at a bank in Jersey dispensing dual currencies: Bank of
England sterling and Jersey pounds

Although ATMs were originally developed as just cash dispensers, they have evolved to
include many other bank-related functions. In some countries, especially those which
benefit from a fully integrated cross-bank ATM network (e.g.: Multibanco in Portugal),
ATMs include many functions which are not directly related to the management of one's
own bank account, such as:

• Deposit currency recognition, acceptance, and recycling[45][46]


• Paying routine bills, fees, and taxes (utilities, phone bills, social security, legal
fees, taxes, etc.)
• Printing bank statements
• Updating passbooks
• Loading monetary value into pre-paid cards (cell phones, tolls, multi purpose
stored value cards, etc.)
• Ticket purchases (train, concert, etc.).
• Purchasing postal stamps.
• Lottery ticket purchases
• Games and promotional features[47]
• Donations to charities[48]
• Purchase shopping mall gift certificates.
• Cheque Processing Module
• In Australia, South Africa, Ireland, India and the United Kingdom, pre-paid cell
phones can be recharged through some ATMs

In Canada, ATMs are called guichets automatiques in French and sometimes "Bank
Machines" in English. The Interac shared cash network does not allow for the selling of
goods from ATMs due to specific security requirements for PIN entry when buying
goods.[49]

ATMs can also act as an advertising channel for companies to advertise their own
products or third-party products and services.[50]

A South Korean ATM with mobile bank port and bar code reader.

Manufactures have demonstrated and have deployed several different technologies on


ATMs that have not yet reached worldwide acceptance, such as:

• Biometrics, where authorization of transactions is based on the scanning of a


customer's fingerprint, iris, face, etc. Biometrics on ATMs can be found in Asia.
[51][52][53]

• Cheque/Cash Acceptance, where the ATM accepts and recognise cheques and/or
currency without using envelopes[54] Expected to grow in importance in the US
through Check 21 legislation.
• Bar code scanning[55]
• On-demand printing of "items of value" (such as movie tickets, Travellers
Cheques, etc.)
• Dispensing additional media (such as phone cards)
• Co-ordination of ATMs with mobile phones[56]
• Customer-specific advertising[57][58]
• Integration with non-banking equipment[59][60]

[edit] Reliability

ATM running Microsoft Windows that has crashed.

Before an ATM is placed in a public place, it typically has undergone extensive testing
with both test money and the backend computer systems that allow it to perform
transactions. Banking customers also have come to expect high reliability in their ATMs,
[61]
which provides incentives to ATM providers to minimize machine and network
failures. Financial consequences of incorrect machine operation also provide high
degrees of incentive to minimize malfunctions.[62]

ATMs and the supporting electronic financial networks are generally very reliable, with
industry benchmarks typically producing 98.25% customer availability for ATMs[63] and
up to 99.999% availability for host systems.[64] If ATMs 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.

Of course, 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 of banknote being loaded in the money cassettes.
Errors that can occur may be mechanical (such as card transport mechanisms; keypads;
hard disk failures); software (such as operating system; device driver; application);
communications; or purely down to operator error.

An ATM running OS/2 that has crashed.

To aid in reliability, some ATMs print each transaction to a roll paper journal that is
stored inside the ATM, which allows both the users of the ATMs 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,[65][66] the resulting ATM money supplies used by banks
provide no absolute guarantee for proper banknotes, as the Federal Criminal Police
Office of Germany has confirmed that there are regularly incidents of false banknotes
having been provided through bank ATMs.[67] Some ATMs may be stocked and wholly
owned by outside companies, which can further complicate this problem when it
happens.[68] Bill validation technology can be used by ATM providers to help ensure the
authenticity of the cash before it is stocked in an ATM; ATMs that have cash recycling
capabilities include this capability.[69]
[edit] 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 were able to steal information from cards
inserted into the machine by customers.[70]

In some cases, bank fraud could occur at ATMs whereby the bank accidentally stocks the
ATM with bills in the wrong denomination, therefore giving the customer more money
than should be dispensed.[71] The result of receiving too much money may be influenced
on the Card Holder Agreement in place between the customer and the Bank.[72][73]

In a variation of this, WAVY-TV reported an incident in Virginia Beach of September


2006 where a hacker who had an admin password for a gas station's white label ATM
caused the unit to assume it was loaded with $5 USD bills instead of $20s, enabling
himself--and many subsequent customers--to walk away with four times the money they
said they wanted to withdraw.[74][75]

ATM behavior 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
account, which could result in fraud.[76]

[edit] Card fraud

In an attempt to prevent criminals from shoulder surfing the customer's PINs, some banks
draw privacy areas on the floor.

For a low-tech form of fraud, the simplest is to simply steal a customer's card. 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.

Another simple form of fraud involves attempting to get the customer's bank to issue a
new card and stealing it from their mail.[77]

Some ATMs may put up warning messages to customers to not use them when it detects
possible tampering.

The concept and various methods of copying the contents of an ATM card's magnetic
stripe on to a duplicate card to access other people's financial information was well
known in the hacking communities by late 1990.[78]

In 1996 Andrew Stone, a computer security consultant from Hampshire in the UK was
convicted of stealing in excess of £1 million Sterling (at the time equivalent to US$1.6
million) by pointing high definition video cameras at ATMs from a considerable
distance, and by 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.[79]

By contrast, a newer high-tech modus operandi 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 to observe the user's PIN. Card data is then cloned onto a
second card and the criminal attempts a standard cash withdrawal. The availability of
low-cost commodity wireless cameras and card readers has made it a relatively simple
form of fraud, with comparatively low risk to the fraudsters.[80]

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 un-authenticated devices, and by attempting to make the
outside of their ATMs tamper evident. Older chip-card security systems include the
French Carte Bleue, Visa Cash, Mondex, Blue from American Express[81] and EMV '96
or EMV 3.11. The most actively developed form of smart card security in the industry
today is known as EMV 2000 or EMV 4.x.

EMV is widely used in the UK (Chip and PIN) and parts of Europe, but when it is not
available in a specific area, ATMs must fallback to using the easy to copy magnetic stripe
to perform transactions. This fallback behaviour can be exploited.[82]

[edit] Related devices


A Talking ATM is a type of ATM that provides audible instructions so that persons who
cannot read an ATM screen can independently use the machine. All audible information
is delivered privately through a standard headphone jack on the face of the machine.
Information is delivered to the customer either through pre-recorded sound files or via
text-to-speech speech synthesis.

A postal interactive kiosk may also share many of the same components as an ATM
(including a vault), but only dispenses items relating to postage.[83][84]

A scrip cash dispenser may share many of the same components as an ATM, but 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. The
customer then takes this receipt to a nearby sales clerk, who then exchanges it for cash
from the till.[85]

A Teller Assist Unit may also share many of the same components as an ATM (including
a vault), but they are distinct in that they are designed to be operated solely by trained
personnel and not the general public, they do not integrate directly into interbank
networks, and are usually controlled by a computer that is not directly integrated into the
overall construction of the unit.

[edit] See also


Numismatics Portal
Information technology Portal
Business and Economics Portal

• EFTPOS
• Banknote Counter
• Financial cryptography
• List of companies involved with ATMs
• Payroll Card
• Electronic funds transfer
• Phantom withdrawal
• Plofkraak

[edit] References
1. ^ Inventor of the Week: Luther George Simjian MIT
2. ^ Enfield's cash gift to the world. BBC London (27 June 2007).
3. ^ The man who invented the cash machine. BBC News.
4. ^ a b c Pins and Needles. Guardian Unlimited (20 January 2005). Retrieved on
2007-04-12.
5. ^ ATM inventor honoured. BBC News.
6. ^ THINGS YOU DIDN'T KNOW ABOUT BARCLAYS CASH DISPENSERS.
PR Newswire.
7. ^ Eicon Networks Develops SSL-VPN For Secure Remote Working IT Observer
8. ^ Number of ATMs worldwide expected to hit 1.5 million in December
www.atmmarketplace.com article
9. ^ Statistics -> ABM Stats Interac website
10. ^ Statistics on payment and settlement systems in selected countries - Figures for
2004 Bank for International Settlements
11. ^ Central bank payment system information Bank for International Settlements
12. ^ Assessing payments systems in Latin America The Economist Intelligence Unit
Limited
13. ^ Financial access and financial stabilityPDF Bank for International Settlements,
Penelope Hawkins
14. ^ Mastercard.com ATM locator
15. ^ Antarctica Sun Times - ONLINE U.S. Antarctic Program December 15, 1996
newsletter
16. ^ Navy/Marine Cash™ - Next Generation ATMs-at-Sea Rolls Out United States
Department of the Treasury website
17. ^ ATMDepot.com questions and answers www.atmdepot.com
18. ^ "Automated Teller Systems - UL 291" Underwriters Laboratories website
19. ^ "S 2.95 Obtaining suitable protective cabinets" Bundesamt für Sicherheit in der
Informationstechnik
20. ^ [1] RAL Deutsches Institut für Gütesicherung und Kennzeichnung e.V.
21. ^ "NCR Personas 75 Technical Specification" NCR website
22. ^ "CEN On-line catalogue - ICS: 13.310 Protection against crime" Comité
Européen de Normalisation
23. ^ [2] British Standards Institution
24. ^ "MODEL 9100 ATM USER / INSTALLATION MANUAL"PDF Triton ATM
Machines
25. ^ "Messaging standard to give multiple channels a common language"
www.selfserviceworld.com website
26. ^ "Welcome to J/XFS" J/XFS Homepage
27. ^ "Windows Cash-Machine Worm Generates Concern"
www.technewsworld.com, Jay Lyman, 12/09/03
28. ^ "An end to ram raids?" www.atmmarketplace.com
29. ^ "STAT-USA Market Research Reports - ATM Thefts" US Economics and
Statistics Administration report summary via Industry Canada
30. ^ "Security" TraceTag UK
31. ^ "Getting Triple DES compliant" www.atmmarketplace.com
32. ^ "The No. 1 ATM security concern" www.atmmarketplace.com
33. ^ "ATM Fraud And Security White Paper"PDF a Diebold report via Credit Union
National Association
34. ^ "Japan Seeks To Standardize Biometric ID Method For ATMs" International
Biometric Industry Association
35. ^ "Cards: Biometrics Stalled Amid The Hype" International Biometric Industry
Association
36. ^ "Consumer Complaint Board: Banks also responsible for the success of ATM
withdrawals abroad" Kuluttajavirasto (Finnish Consumer Agency & Ombudsman)
37. ^ "New reasons to guard your ATM card" Christian Science Monitor via MSN
38. ^ "Text of the ATM Safety Act" State of New York Banking Department
39. ^ "Consultants Call for Increased ATM Security Measures"
www.atmmarketplace.com, Jane Blake, 04 Dec 2000
40. ^ "Politics (not) as usual, with ATMIA's help" www.atmmarketplace.com, John
McGill, 07 September 2004
41. ^ See comments of Representative Mario Biaggi, Congressional Record, July 30,
1986, Page 18232 et seq.
42. ^ "ATM Report" Illinois Department of Financial and Professional Regulation
43. ^ "CU t-t News - 2/16/04" Credit Union National Association
44. ^ "06 LC 34 0466 - Senate Bill 379 PRE-FILE Georgia General Assembly
45. ^ [3] www.selfserviceworld.com
46. ^ [4] Fujitsu
47. ^ [5] BBC article about Ogaki Kyoritsu Bank ATMs]
48. ^ "Indonesians make ATM sacrifices" BBC article about purchasing livestock for
the poor in Indonesia
49. ^ "Consumers' FAQ, IDP Point 4" Interac
50. ^ http://www.creativematch.co.uk/?action=viewnews&ni=90724
51. ^ [6] The Japan Times
52. ^ [7] Web Japan
53. ^ [8] American City Business Journals
54. ^ [9] BAI
55. ^ [10] Accurapid
56. ^ [11] Engadget
57. ^ [12] Wincor Nixdorf
58. ^ [13] NCR
59. ^ [14] Freescale
60. ^ [15] NRT Technology
61. ^ [16] International Management Journals
62. ^ "ATM gives out free cash and lands family in court" Guardian Unlimited
63. ^ "Uptime in Real Time"PDF NCR publication
64. ^ [17] Stratus Technologies news release
65. ^ [18] Ottawa Business Journal
66. ^ [19] Bank of Canada
67. ^ [20] Stern.de report of 2004-05-05 (in German)
68. ^ [21] www.atmmarketplace.com
69. ^ [22] Wincor Nixdorf website describing Cash Recycling
70. ^ http://www.wired.com/wired/archive/1.05/atm_pr.html
71. ^ [23] BBC
72. ^ [24] Royal Bank of Canada Client Card Cardholder Agreement
73. ^ "Mad rush to faulty ATM in France" BBC report about a cash machine not
being stocked correctly
74. ^ "ATM turns $5s into $20s" CNN/WAVY report, 9/14/06, about a hacked ATM
at a gas station
75. ^ Ibid, mirrored on YouTube
76. ^ [25] Australasian Legal Information Institute
77. ^ Fun with Automatic Tellers Phrack Magazine Volume One, Issue Eight
78. ^ "Automatic Teller Machine Cards" Phrack Magazine, Phrack Classic Volume
Three, Issue 32
79. ^ [26] Oxford Journals ITNOW
80. ^ [27] Snopes
81. ^ [28] Fast Company
82. ^ [29] The Hindu
83. ^ [30] United States Postal Service news release
84. ^ [31] PostalReporter.com news report
85. ^ [32] Merchant Payment Services, Inc.

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345-42008-X
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[edit] External links

Wikimedia Commons has media related to:


Automatic teller machine

• HowStuffWorks.com - Video: Inside an ATM machine


• The Money Machines – An account of U.S. ATM history; By Ellen Florian,
Fortune.com
• Britain celebrates 40 years of the ATM

How ATMs Work

You're short on cash, so you walk over to the automated teller machine (ATM), insert
your card into the card reader, respond to the prompts on the screen, and within a minute
you walk away with your money and a receipt. These machines can now be found at most
supermarkets, convenience stores and travel centers. Have you ever wondered about the
process that makes your bank funds available to you at an ATM on the other side of the
country? In this article, we will look at the ATM device that allows you access to your
money and examine the network that the ATM connects to

ATM Card vs. Check Card


As an alternative to writing checks and using a credit card, most major banks have
teamed up with major credit-card companies to issue check cards.

Check cards are different from straight ATM cards in a couple of ways. First, check
cards are also known as debit cards because of how they work -- instead of getting credit
for your purchase and receiving a monthly bill, like you do with a credit card, a
check/debit card deducts money from your checking or savings account.
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Also, while you can only use your ATM card at the ATM machine (and some grocery
stores), you can use a check card at most retailers that accept credit cards, such as:

• Grocery stores
• Gas stations
• Discount superstores
• Book stores
• Ticket counters (concert tickets, airline tickets, etc.)
• Pharmacies
• Hotels
• E-tailers
• Restaurants

There are exceptions. Some hotels and rental car services only accept credit cards
because it's easier, cheaper, and less of a risk to them than check cards. Those that do
accept check cards often put a certain amount of money in your bank account "on hold"
(unavailable to you) -- usually the cost of the room or rental including taxes and other
fees, plus a percentage of the total or a fee to cover possible damages. When you check
out of the hotel or turn in your rental car, the difference between the "hold" amount and
what you're actually billed is released back into your account. This is something to
consider when using your debit card to reserve a hotel room or rent a car.

ATM Image Gallery

ATM cards and check cards can be used in different ways.


See more ATM pictures.

You can use your check card as either a credit card or a debit card -- either way, it comes
out of your account. The only difference is that if you tell the clerk "credit card," you sign
a slip, and if you tell the clerk "debit card," you enter your PIN number instead of
signing. Some banks charge you a fee if you use your check card as a debit card (if it
costs them more to process those transactions), but not if you use it as a credit card.
It's easy to tell the difference between a plain ATM card and a check card: A check card
has your name, "credit" account number, the credit company's logo, the bank's logo and
"Check Card" printed across the front of it; an ATM card has only your name, account
number and bank's logo on the front of it. Both cards have strips on the back for the
authorized cardholder to sign on. A check card company, such as Visa, has agreements
with banks to issue what looks like a Visa credit card. A Visa check card can be used at
any retailer that accepts Visa credit cards and at ATMs worldwide.

How Do ATMs Work?


An ATM is simply a data terminal with two input and four output devices. Like any
other data terminal, the ATM has to connect to, and communicate through, a host
processor. The host processor is analogous to an Internet service provider (ISP) in that it
is the gateway through which all the various ATM networks become available to the
cardholder (the person wanting the cash).

Most host processors can support either leased-line or dial-up machines. Leased-line
machines connect directly to the host processor through a four-wire, point-to-point,
dedicated telephone line. Dial-up ATMs connect to the host processor through a normal
phone line using a modem and a toll-free number, or through an Internet service provider
using a local access number dialed by modem.

Leased-line ATMs are preferred for very high-volume locations because of their thru-
put capability, and dial-up ATMs are preferred for retail merchant locations where cost is
a greater factor than thru-put. The initial cost for a dial-up machine is less than half that
for a leased-line machine. The monthly operating costs for dial-up are only a fraction of
the costs for leased-line.

The host processor may be owned by a bank or financial institution, or it may be owned
by an independent service provider. Bank-owned processors normally support only bank-
owned machines, whereas the independent processors support merchant-owned
machines.

Parts of the Machine


You're probably one of the millions who has used an ATM. As you know, an ATM has
two input devices:

• Card reader - The card reader captures the account information stored on the
magnetic stripe on the back of an ATM/debit or credit card. The host processor
uses this information to route the transaction to the cardholder's bank.
• Keypad - The keypad lets the cardholder tell the bank what kind of transaction is
required (cash withdrawal, balance inquiry, etc.) and for what amount. Also, the
bank requires the cardholder's personal identification number (PIN) for
verification. Federal law requires that the PIN block be sent to the host processor
in encrypted form.

And an ATM has four output devices:

• Speaker - The speaker provides the cardholder with auditory feedback when a
key is pressed.
• Display screen - The display screen prompts the cardholder through each step of
the transaction process. Leased-line machines commonly use a monochrome or
color CRT (cathode ray tube) display. Dial-up machines commonly use a
monochrome or color LCD.
• Receipt printer - The receipt printer provides the cardholder with a paper receipt
of the transaction.
• Cash dispenser - The heart of an ATM is the safe and cash-dispensing
mechanism. The entire bottom portion of most small ATMs is a safe that contains
the cash.

Sensing Bills
The cash-dispensing mechanism has an electric eye that counts each bill as it exits the
dispenser. The bill count and all of the information pertaining to a particular transaction
is recorded in a journal. The journal information is printed out periodically and a hard
copy is maintained by the machine owner for two years. Whenever a cardholder has a
dispute about a transaction, he or she can ask for a journal printout showing the
transaction, and then contact the host processor. If no one is available to provide the
journal printout, the cardholder needs to notify the bank or institution that issued the card
and fill out a form that will be faxed to the host processor. It is the host processor's
responsibility to resolve the dispute.

Besides the electric eye that counts each bill, the cash-dispensing mechanism also has a
sensor that evaluates the thickness of each bill. If two bills are stuck together, then
instead of being dispensed to the cardholder they are diverted to a reject bin. The same
thing happens with a bill that is excessively worn, torn, or folded.
The number of reject bills is also recorded so that the machine owner can be aware of the
quality of bills that are being loaded into the machine. A high reject rate would indicate a
problem with the bills or with the dispenser mechanism.

ATMs for the Visually Impaired


There are ATMs that are accessible to blind and visually impaired people.
These machines are located at kiosks rather than bank drive-thrus. And the
keypads at ATMs are equipped with braille.