ATM MACHINE Sept.
Powered By: Chandan Kumar
The Specifications of the ATM Machine. Diagrams. ATM as the liquidity management. The Various services provided by ATM. ATM Safety Guide. This paper also presents the working of ATM. Problems. its various requirements. 18. 2011
This paper presents the concept of the Liquidity Management. Banks. The safety guide to use the ATM.
.ATM MACHINE Sept. ATM Working. KEY WORDS: ATM. Fees. ATM History. ATM services. Customer satisfaction.
personal attendance of the customer. punch in a few details and go home with hard cash.
ATM means neither “avoids traveling with money” nor “any time money. they are rewriting the rules of financial transaction. The plastic card is replacing cheque.ATM MACHINE Sept. banks are able to serve customers outside the banking hall. 18.” but certainly implies both. insert it in the slot. All he needs to do is fish out an ATM (automated teller machine) card. ATM is designed to perform the most important function of bank. A smart person no longer needs to carry a wallet-full of paper money on his person. In a way. ATMs have made hard cash just seconds away all throughout the day at every corner of the globe. With advent of Automatic Teller Machines (ATM). magneticstrip card and personal identification number issued by the financial institution. It is operated by plastic card with its special features. Automated teller machines (ATMs) were the first well-known machines to provide electronic access to customers. banking hour’s restrictions and paper based verification. ATMs allow you to do a number of banking functions – such as withdrawing cash from one’s account.
Automated Teller Machine is a computerised machine that provides the customers of banks the facility of accessing their accounts for dispensing cash and to carry out other financial transactions without the need of actually visiting a bank branch. making balance inquiries and transferring money from one account to another – using a plastic. Slim ATM cards are fast replacing confounding withdrawal forms as a convenient way of getting your money from banks.
Reg Varney. Peter Lee Chappell. The first of these that was put into use was by Barclays Bank in Enfield Town in North London. Leonard Perkins. 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 nine days and Westminster Bank’s-Smith Industries-Chubb system (called Chubb MD2) by a month. as plastic bank cards had not yet been invented. the United Kingdom and the United States. His design used special cheques that were matched with a personal identification number. engineers in Sweden and Britain developed their own cash machines during the early 1960s.
. An experimental Bankograph was installed in New York City in 1961 by the City Bank of New York. first to use a cash point in the UK
Plaque commemorating installation of world's first bank cash machineIn simultaneous and independent efforts. 2011
The idea of self-service in retail banking developed through independent and simultaneous efforts in Japan.ATM MACHINE Sept. It was followed in 1967 by a machine in Uppsala. United Kingdom. This instance of the invention has been credited to John Shepherd-Barron of printing firm De La Rue. was delayed a couple of years. Although little is known of this first device. The rollout of this machine called Bankograph. it seems to have been activated with a credit card rather than accessing current account balances. Sean Benjamin Newcombe & Malcom David Roe. The collaboration of a small start-up called Speytec and Midland Bank developed a third machine which was marketed after 1969 in Europe and the USA by the Burroughs Corporation. being acquired by Universal Match Corporation. Luther George Simjian has been credited with developing and building the first cash dispenser machine. 18. Sweden. A first cash dispensing device was used in Tokyo in 1966. John Henry Donald. on 27 June 1967. This machine was the first in the UK and was used by English comedy actor Reg Varney. The Bankograph was an automated envelope deposit machine (accepting coins. In the USA. but removed after 6 months due to the lack of customer acceptance. who was awarded an OBE in the 2005 New Year's Honours List. This was due in part to Simjian's Reflectone Electronics Inc. at the time so as to ensure maximum publicity for the machines that were to become mainstream in the UK. There is strong evidence to suggest that Simjian worked on this device before 1959 while his 132nd patent (US3079603) was first filed on 30 June 1960 (and granted 26 February 1963). cash and cheques) and it did not have cash dispensing features. The patent for this device (GB1329964) was filed on September 1969 (and granted in 1973) by John David Edwards.
Chemicals' ATM. The idea of a PIN stored on the card was developed by a British engineer working on the MD2 named James Goodfellow in 1965 (patent GB1197183 filed on 2 May 1966 with Anthony Davies). Chemical Bank installed the first ATM in the U. Cashpoint is still a registered trademark of Lloyds TSB in the UK. On September 2. Diebold 10xx and TABS 9000 series. Additionally. 1969. the IBM 2984 was designed at the request of Lloyds Bank. The first ATMs were designed to dispense a fixed amount of cash when a user inserted a specially coded card. It had a profound influence on the industry as a whole. at its branch in Rockville Centre. In 1995. This patent was filed on 5 March 1968 in the USA (US 3543904) and granted on 1 December 1970.
Financial networks :
. in Dallas. 2011
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 strip at the back. After looking first hand at the experiences in Europe. who was a department head at an automated baggage-handling company called Docutel. by Donald Wetzel. New York. but a number of later patents reference this patent as “Prior Art Device”. in 1968 the networked ATM was pioneered in the US. 2 our bank will open at 9:00 and never close again. The 2984 CIT (Cash Issuing Terminal) was the first true Cashpoint. This patent is also the earliest instance of a complete “currency dispenser system” in the patent record. Chemical executives were initially hesitant about the electronic banking transition given the high cost of the early machines. executives were concerned that customers would resist having machines handling their money.ATM MACHINE Sept. All were online and issued a variable amount which was immediately deducted from the account. A small number of 2984s were supplied to a US bank. They used principles including Carbon-14 and low-coercivity magnetism in order to make fraud more difficult. initially known as a Docuteller was designed by Donald Wetzel and his company Docutel. Texas. The essence of this system was that it enabled the verification of the customer with the debited account without human intervention. Notable historical models of ATMs include the IBM 3624 and 473x series. NCR 1780 and earlier NCR 770 series. 18. similar in function to today's machines.S. ATMs first came into use in December 1972 in the UK. Not only did future entrants into the cash dispenser market such as NCR Corporation and IBM licence Goodfellow’s PIN system. A Chemical Bank advertisement boasted "On Sept. the Smithsonian National Museum of American History recognized Docutel and Wetzel as the inventors of the networked ATM.
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. and TCP/IP over Ethernet. 2011
Most ATMs are connected to interbank networks. Leased lines are preferable to POTS lines because they require less time to establish a connection. Common lower-level layer communication protocols used by ATMs to communicate back to the bank include SNA over SDLC. In some cases. X.25. 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 PULSE.
A Diebold 1063ix with a dial-up modem visible at the base ATMs typically connect directly to their host or ATM Controller via either ADSL or dialup modem over a telephone line or directly via a leased line. in other cases.
. which allows for the use of a scrip cash dispenser. Leased lines may be comparatively expensive to operate versus a POTS line. 18. meaning less-trafficked machines will usually rely on a dial-up modem. Interswitch. Many banks charge ATM usage fees. and LINK. This is often performed through an ISO 8583 messaging system. STAR. Interac. That dilemma may be solved as highspeed Internet VPN connections become more ubiquitous. ATMs rely on authorization of a financial transaction by the card issuer or other authorizing institution via the communications network. In order to allow a more diverse range of devices to attach to their networks. Cirrus.ATM MACHINE Sept. PLUS. TC500 over Async. these fees are charged solely to users who are not customers of the bank where the ATM is installed. they apply to all users.
standard commercial "off-the-shelf" operating systems and programming environments can be used inside of ATMs. There is a computer industry security view or consensus that desktop operating systems have greater risks as operating systems for cash dispensing machines than other types of operating systems like (secure) real-time operating systems (RTOS).
used to select the various aspects of the transaction. 18.
Requirements of an ATM machine: Hardware Requirements:
CPU :To control the user interface and transaction devices Magnetic and/or Chip card reader: To identify the customer.
.ATM MACHINE Sept. RISKS Digest has many articles about cash machine operating system vulnerabilities. Windows CE or Windows 2000. Vista was not widely adopted in ATMs. A small number of deployments may still be running older versions such as Windows NT.
Record Printer: To provide the customer with a record of their transaction. Display: Used by the customer for performing the transaction. all communications traffic between the ATM and the Transaction Processor may also be encrypted via methods such as SSL. PIN Pad: Similar in layout to a Touch tone or Calculator keypad.
SOFTWARE Requirements :
With the migration to commodity PC hardware. Notably. Housing: For aesthetics and to attach signage. generally within a secure enclosure. often
manufactured as part of a secure enclosure. 2011
In addition to methods employed for transaction security and secrecy. Vault: To store the parts of the machinery requiring restricted access. Function key buttons: Usually close to the display (or) Touch screen.
Secure crypto processor. Today the vast majority of ATMs worldwide use a Microsoft OS. Typical platforms previously used in ATM development include RMX or OS/2. primarily Windows XP Professional or Windows XP Embedded.
y. While the perceived benefit of XFS is similar to the Java's "Write once. Most major ATM manufacturers provide software packages that implement these protocols. the largest bank in the south of Brazil. run anywhere" mantra.g. The result of these differences in interpretation means that ATM applications typically use a middleware to even out the differences between various platforms. where x. WOSA/XFS. Newer protocols such as IFX have yet to find wide acceptance by transaction processors. Notable ATM software that operates on XFS platforms include Triton PRISM. Linux is also finding some reception in the ATM marketplace. and Wincor Nixdorf ProTopas. Absolute Systems AbsoluteINTERACT. they have evolved to include many other bank-related functions. 18. which has replaced the MS-DOS operating systems in its ATMs with Linux. Diebold Agilis EmPower. Common application layer transaction protocols.ATM MACHINE Sept. concern has risen about the integrity of the ATM's software stack. With the onset of Windows operating systems and XFS on ATM's. now known as CEN XFS (or simply XFS). With the move of ATMs to industry-standard computing environments. often different ATM hardware vendors have different interpretations of the XFS standard. Phoenix Interactive VISTAatm. especially those which
. 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. although companies like NCR continuously improve these protocols issuing newer versions (e. provides a common API for accessing and manipulating the various devices of an ATM. NCR APTRA Edge. In some countries. the software applications have the ability to become more intelligent. An example of this is Banrisul. J/XFS is a Java implementation of the CEN XFS API. KAL Kalignite.x. Banco do Brasil is also migrating ATMs to Linux.
ATM as Liquidity Management :
Although ATMs were originally developed as just cash dispensers. It is now empowered to connected to other content servers and video banking systems.y are subversions). such as Diebold 91x (911 or 912) 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. NCR's AANDC v3. 2011
A Wincor Nixdorf ATM running Windows 2000. 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.
• Paying (in full or partially) the credit balance on a card linked to a specific current account. ATMs include many functions which are not directly related to the management of one's own bank account.
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. o Lottery tickets o Train tickets o Concert tickets o Movie tickets o Shopping mall gift certificates. 2011
benefit from a fully integrated cross-bank ATM network (e.ATM MACHINE Sept. and the machine will swap your plastic or paper money for a small bar of the real stuff. • Games and promotional features • Fastloans • CRM at the ATM • Donating to charities • Cheque Processing Module • Adding pre-paid cell phone / mobile phone credit. legal fees.
ATM Working DIAGRMS:
. 18. taxes.) • Printing bank statements • Updating passbooks • Loading monetary value into stored value cards • Purchasing o Postage stamps. such as: Deposit currency recognition. social security. and taxes (utilities. acceptance. etc. and recycling[ Paying routine bills. fees. • Transferring money between linked accounts (such as transferring between checking and savings accounts) • Gold ."In London last week [in 2011] some smart businessmen launched the country’s first gold ATM. ATMs can also act as an advertising channel for companies to advertise their own products or third-party products and services. phone bills. Stick in your credit card or some cash.g.: Multibanco in Portugal).
.ATM MACHINE Sept. 18.
in some cases.
Typical ATMs have two input devices (a card reader and keypad) and four output devices (display screen. and speaker). cash dispenser. In order to provide access to these products. it comes with an operating system and specific
Identification and providing access to its products through the various electronic channels. The card and the PIN are directly related to the user identification and allow for the utilization of electronic channels just like as is the case with the ATMs. receipt printer. The ATM functions much like a PC.ATM MACHINE Sept. cards with magnetic bands are normally associated to a personal identification number (PIN) which is initially assigned by the entity issuing the card and. the client can then change it at his/her convenience. Not visible to the client is a communications mechanism that links the ATM directly to an ATM host network. 18.
ATM MACHINE Sept. Whereas most ATMs use magnetic strip cards and personal identification numbers (PINs) to identify account holders. the host processor signals for an electronic funds transfer (EFT) from the customer’s bank account to the host processor’s account. The host systems can reside at the client’s institution or be part of an EFT network. or credit card transactions using a signature. The EFT network may support debit card transactions using PINs. If the cardholder is requesting cash. depending on the cost and reliability of infrastructure. This communication. Leased line. Once the funds have been transferred.application software for the user interface and communications. other systems may use smart cards with fingerprint validation. and authorization can be delivered several ways. EFTs often has a national or regional scope. the ATM receives an approval code authorizing it to dispense the cash. dialup. which then routes the request to the client’s financial institution. 2011
. or wireless data links may be used to connect to the host system. Point-of-sale services that use PINs are also possible. 18. The ATM forwards information read from the client’s card and the details of the client’s request to a host processor.
At such an institution. Many technology service providers can supply institutional support to fully integrate controls. maintenance. On its own. staff and client training.ATM MACHINE Sept.1 • Lack of adequate controls can open the door to theft and/or fraud. Technology works best as a tool to facilitate systems in a properly functioning MFI. Failing to do so can reduce adoption rates and/or lead to a rejection of the technology by the targeted clients. This must be considered and adequately planned for when switching from highly personalized services to automated transactions. Institutions need to make sure they are able to track funds that have been deposited into the ATMs but not yet accounted for in central accounts as fraud or errors may be involved with the deposit. new controls) it will be unable to understand the cost-benefit of using the new machines and could end up with a poor investment. institutions must be prepared to educate clients on the benefits and train them in the use of the new technology. If financial service providers do not fully calculate the cost of the ATMs on the institution (purchase. technology may just automate problems and highlight inefficiencies. Clients are often relationship oriented and enjoy person-to-person transactions. sometimes it is impossible to do so cost-effectively. • Failure to adequately consider the implications of ATMs on the business financial and operational performance. ATMs require a high degree of additional control beyond those traditionally employed by rural and agricultural financial service providers.
. installation. • Depersonalizing services can alienate clients. Even in cases in which technology can solve problems. technology will never solve the problems of an inefficient and poorly managed institution. • Lack of understanding of client demand for and willingness to adopt ATMs can lead to failed implementation. When initiating new technologies such as offering financial services through ATMs. These transactions build trust and familiarity while automating processes can depersonalize services and alienate clients. 18. 2011
• Technology on its own will not solve problems of inefficiency or poor management. MFIs should ensure that they have a precise understanding of the necessary controls to safeguard ATM operations before they launch the product.
look and watch
If you think someone is following you when you use your ATM card. ears and feelings. You should be fully reimbursed if you notify your bank promptly. Only use ATMs where you feel safe. 2011
ATM SAFETY GUIDE: BE ALERT Use common sense
Trust your eyes. • NEVER tell your PIN to anyone. Don’t stay at the machine. • Contact the bank and report the problem immediately.
. Treat your ATM card like cash. checks and credit cards.
Guard your card
Tell your bank immediately if: • your ATM card is lost or stolen or • any unauthorized ATM transactions appear on your account statements.
Keep your personal identification number (PIN) a secret • Memorize your PIN. move quickly to a safe. • NEVER let someone else enter it for you.
Know the ATM
Do not use the ATM if: • the ATM looks different or • the ATM has any unusual signs. 18. crowded area.ATM MACHINE Sept. Guard your ATM/debit card as carefully as cash. • Stand between the machine and anyone behind you. • NEVER write it on your card or keep it with the card.
c. so bring along a friend if you can. While using your card. d. b.
. At your walk-up ATM:
Don’t flash cash
Put away your money.
• Play it safe at night
Choose an ATM that is well lit. 2. drive away at once. place your bags and purchases between you and the machine where you can easily see them. There is safety in numbers. At your drive-up ATM: a. Minimize time spent at the ATM. • Never walk around with cash in your hand. Make sure your doors are locked. c. If something seems unusual. NEVER let a stranger help you at an ATM. card and wallet right away. Only open the driver’s window. receipt.ATM MACHINE Sept. if anyone or anything seems suspicious. d. Keep your car engine running. 2011
Practice safety 1. Have your card ready to use. press cancel and leave immediately.
BE CAREFUL • Protect your purchases
When using an ATM. 18. b.