Automated Teller Machine (ATM)

An Automated Teller Machine (ATM) cash machine (in British English) is a computerized telecommunications device and real-time system that provides the clients of a financial institution with access to their bank accounts in a public space without intervention administration of financial institution. To use an automatic teller machine, clients must have a plastic ATM card with a plastic smart card with a chip or a magnetic stripe, which contains a unique card number and some security information about the client. The customer is identified by inserting plastic ATM card and entering a personal identification number (PIN)for the customer.

History of ATM

The first ATM turned up at a Barclays Bank branch in London in 1967, though there are records of a cash dispenser in Japan in the mid-1960s. The interbank transaction that allowed a customer to use one bank’s card at another bank’s ATM in the 1970s. Currently, more than 3.5 million ATMs are in operation worldwide.

History of ATM in India

The first ATM in India was set up in 1987 by HSBC in Mumbai. In the following twelve years, about 1500 ATMs were set up in India. In 1997, the Indian Banks' Association (IBA) set up Swadhan, the first network of shared ATMs in India. It was managed by India Switch Company (ISC) for five years, and allowed cardholders to withdraw cash from any ATM in the network, for a fee if they did not have an account with the bank that owned the ATM. In 2002, the network connected over 1000 ATMs of the 53 member banks of the association. In contrast, ICICI Bank's network of about 640 ATMs handled transactions worth about ₹2,00,00,000 each day. After the contract with ISC expired, IBA failed to find a bidder to manage the operationally uneconomical network, and shut it down on 31 December 2003.

After the collapse of Swadhan, Bank of India, Union Bank of India, Indian Bank, United Bank of India and Syndicate Bank formed an ATM-sharing network called Cash Tree. Citibank, the Industrial Development Bank of India, Standard Chartered Bank and Axis Bank formed a similar network called Cash net. Punjab National Bank and Canara Bank also created such networks. In August 2003, the IDRBT announced that it would be creating the National Financial Switch (NFS) to link together the country's ATMs in a single network. The IDRBT collaborated with Euro net Worldwide and Opus Software to build a platform to allow banks to connect their own switches to the NFS. The NFS consisted of an inter-ATM switch and a e-commerce payment gateway.

The Reserve Bank of India granted authorisation to NPCI to take over the operations of National Financial Switch (NFS) from the Institute of Development and Research in Banking Technology (IDRBT) on a ‘as is where is basis’ on 15 October 2009.

Types of ATM

1. Basic units permit only cash withdrawal by clients and provide updated account balance.
2. The more complicated machines in which you can also deposit cash, facilitate credit line payments and transfers, and access account details.

Functions OF ATM’s

• Deposit of cash
• Withdrawal of cash
• Transfer of cash
• Accounts details
• Mini statement
• Regular payment of the bill
• Account balance details
• Recharge of prepaid mobile
• Change the pin code

Advantages of ATM

• ATM is easy to use.
• ATM service is available for 24 ✕ 7.
• ATM reduces the work pressure on bank staff.
• For travellers , these are more useful.
• It gives service without any error.