Nowadays, everyone is familiar with ATMs. In fact, it’s a necessity for most of us. Still, many people need to learn whats the meaning of atm and what ATM stands for. However, for most of us, it’s just a cash dispensing machine, but it is more capable than just dispensing cash.
There is a whole mechanism and science behind the ATMs. However, to acknowledge our readers about ATMs and how they work, we present you this blog. In this blog, we cover the technical and historical aspects of ATMs.
When Did It Start?
The History of ATMs dates back to the 1960s in the streets of the USA. A public ATM dispenses cash in New York for the first time, thanks to Donald Wetzel. The acronym ATM stands for automated teller machine. It is one of the first machines to process a transaction even without stepping into the bank.
The core purpose of this machine was to withdraw cash without human assistance. People used to wait in bank queues to withdraw cash, consuming hours. Therefore ATM was the solution to this problem. Thus, it is named an automated teller machine.
Moreover, ATMs are from the 1960s, but their popularity came in the 1980s. Then Additional features were added, i.e. printing receipts and showing the account’s remaining balance. Now ATMs are everywhere, especially in Canada and USA. Try searching “atm machines near me,” “royal bank near me,” or any other banks ATM. You can witness dozens of ATMs available within a radius of 500 metres.
How Does An ATM Operate?
As a kid, you must have wondered how ATMs dispense cash from where they bring it. Or anyone sitting inside the machine who withdraws the cash. These are the questions in the mind of a 9-10-year-old kid. Anyway, logically ATMs operate in 3 steps.
There are three checkpoints for an ATM to process any transaction. 1. ATM 2. Host Computer 3. Bank. Let’s break down the operations an ATM has to perform. Suppose a cibc atm machine or national bank atm first reads the card info with the help of a card reader. Then the ATM sends that info to the host computer. Last, the host computer transfers the command to the bank, and the bank releases the amount after confirming the details. The ATM uses a phone line, internet connection or wireless device to establish communication with the bank. And there is a cash box inside each ATM where the bank authority loads the cash. When ATM runs out of cash, bank authorities reload it again.
What Are The Specifications Of Modern ATMs?
Like 50 years ago today, the only function of the ATMs was to withdraw cash. As time passed, ATMs got upgradation and became smart. Now ATMs can multi-task and have more features than just cash dispensing. However, modern ATMs are equipped with the features enlisted below.
- Cash Deposit
Now the ATMs, apart from withdrawing cash, are also accepting it. The public doesn’t need to go to the bank for cash deposits, as ATMs have also solved this problem. However, going to the bank from a busy schedule was tough. And banks are open only during the daytime, but the ATMs operate 24/7. Go to any atm stand, enter the cash, enter your pin, and you have deposited cash successfully.
- Funds Transfer
The next amazing feature of ATMs is to transfer funds. With the help of an ATM, you can now transfer funds from your bank account to others. Earlier, this was a hectic process. First, people had to withdraw the cash from their accounts and then go to the bank. In the bank, they would deposit the cash in the recipient’s account. However, this was the standard procedure for transferring funds to someone’s account. ATMs have reduced all these hassles. Now one can transfer funds with the help of ATMs within seconds. Visit any atm in canada, be it the rbc atm machine, Scotiabank ATM or some other place where you can avail of this feature.
- Bills Payment
ATMs are eliminating the purpose of visiting banks. Though ATMs now allow the public to pay their bills anytime. As ATMs are getting equipped with new features with time to facilitate people. Whether you have rent to pay, an electricity bill or an internet bill, visit your nearest ATM and clear your bills without visiting any bank.
What are the other benefits of ATMs?
ATMs are one of the great inventions of human history undoubtedly. An ATM facilitates people with so many features. However, there is another benefit of ATMs that most people need to be aware of: the ATM business Model.
The ATM business model allows people to own and earn from it. Yes, anyone can now own an ATM and earn some passive income. However, there are two to own an ATM. 1. To buy an ATM 2. Rental ATM.
Moreover, this business model works best for merchants or retailers. As for buying an ATM or getting on rental, it will earn hundreds of dollars a month. Anyone who withdraws cash from an ATM must pay a surcharge fee, which goes into the owner’s account.
An atm for sale costs you around $3000-$10000, and getting a rental can cost you around $300 a month. So ATMs are also an option for earning a living.
ATMs hold a key value in modern-day banking and add to the convenience of the public to a great extent. However, many people need insight into how this machine works. We have covered many things to acknowledge our readers, and this blog surely will help them big times.