Automated Teller Machine (ATM)

Automated Teller Machine (ATM)

An automated teller machine (ATM) is a self-service electronic terminal that lets bank customers perform basic financial transactions without interacting with a teller. Common services include cash withdrawals, deposits, balance inquiries, transfers, and bill payments. ATMs provide convenient, often 24/7 access to accounts and are found inside and outside bank branches as well as in high-traffic public locations.

Key points

• ATMs enable cash access and other basic banking transactions without visiting a branch.
• Machines range from simple cash dispensers to full-service units that accept deposits and process transfers.
• ATMs are widely deployed globally—numbering in the millions—and operate through interbank networks that let customers use cards at many different machines.
• Using out-of-network or foreign ATMs can incur fees and currency-exchange charges.

A brief history

The first widely recognized ATM installation was by Barclays in London in 1967. Interbank networks that allow card use across different banks developed in the 1970s, enabling the global ATM ecosystem. Since then, ATMs have spread worldwide, appearing in most countries and a wide variety of public venues.

Types of ATMs

• Basic cash-dispensing machines: Withdrawals and balance inquiries.
• Full-service ATMs: Accept deposits (cash and checks), process transfers, and handle bill payments. Full features may require being an account holder at the operating bank.
• Specialized machines: Bitcoin ATMs and other crypto kiosks allow buying or selling digital currencies for cash.

Essential components

Most ATMs share the following parts:
* Card reader — reads chip or magnetic stripe.
Keypad — for entering PINs and transaction choices.
Screen — displays prompts and account information.
Cash dispenser — issues bills from an internal safe.
Printer — provides transaction receipts when requested.
* Deposit slots — on full-service machines, for cash or checks.

How to use an ATM (step-by-step)

1. Insert your debit or credit card into the card slot.
2. Follow on-screen prompts to choose a transaction type.
3. Enter your personal identification number (PIN).
4. Select the amount or account/action required.
5. Collect dispensed cash and any receipt.
6. Retrieve your card and end the session.

ATMs may vary slightly in prompts and layout; always follow the on-screen instructions.

ATM fees and limits

• In-network ATMs (your bank’s machines) are often free for account holders.
• Out-of-network ATMs typically charge a fee, and the ATM operator may add an additional surcharge; some banks reimburse such fees under certain accounts.
• Regular use of fee-charging ATMs can add up—frequent withdrawals at machines charging several dollars each can exceed $100–200 annually.
• Withdrawal limits are set by individual banks and accounts (daily limits commonly range from a few hundred to over a thousand dollars); limits can sometimes be adjusted by contacting the bank.

Using ATMs when traveling

• Foreign ATMs are usually a convenient source of local currency and often yield better exchange rates than currency-exchange booths.
• Expect possible fees from both the ATM operator and your home bank, including fixed charges or a percentage of the withdrawn amount.
• Receipts may not show the exchange rate used, so keep records if you need to reconcile transactions later.

Deposits at ATMs

Some ATMs accept cash and check deposits. Procedures vary: some machines accept loose checks/cash directly, while others require deposit slips or envelopes. When depositing checks, endorse the back and mark “For Deposit Only” if required by your bank.

Conclusion

ATMs are a ubiquitous, convenient way to access cash and perform routine banking tasks without a teller. Machines range from simple dispensers to full-service terminals that accept deposits and process transfers. To minimize cost, use your bank’s ATMs when possible, be aware of fees and withdrawal limits, and review your bank’s policies before using ATMs abroad.