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From Wikipedia, the free encyclopedia
Several terms redirect here. For other uses, see Cash machine (disambiguation), Money
machine (disambiguation), and ATM (disambiguation).
An old Nixdorf ATM
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ATM
A ti l indoor ATMs dispense money inside convenience stores and other busy areas, such as
Smaller
this off-premises Wincor Nixdorf mono-function ICA ATM in Sweden.
An automated teller machine (ATM) is an electronic telecommunications device that enables
customers of financial institutions to perform financial transactions, such as cash withdrawals,
deposits, funds transfers, balance inquiries or account information inquiries, at any time and
without the need for direct interaction with bank staff.
ATMs are known by a variety of other names, including automatic teller machines (ATMs) in the
United States[1][2][3] (sometimes redundantly as "ATM machine"). In Canada, the term
automated banking machine (ABM) is also used,[4][5] although ATM is also very commonly
used in Canada, with many Canadian organizations using ATM rather than ABM.[6][7][8] In
British English, the terms cashpoint, cash machine and hole in the wall are also used.[9][10][11]
ATMs that are not operated by a financial institution are known as "white-label" ATMs.
Using an ATM, customers can access their bank deposit or credit accounts in order to make a
variety of financial transactions, most notably cash withdrawals and balance checking, as well
as transferring credit to and from mobile phones. ATMs can also be used to withdraw cash in a
foreign country. If the currency being withdrawn from the ATM is different from that in which the
bank account is denominated, the money will be converted at the financial institution's exchange
rate.[12] Customers are typically identified by inserting a plastic ATM card (or some other
acceptable payment card) into the ATM, with authentication being by the customer entering a
personal identification number (PIN), which must match the PIN stored in the chip on the card (if
the card is so equipped), or in the issuing financial institution's database.
According to the ATM Industry Association (ATMIA), as of 2015, there were close to 3.5 million
ATMs installed worldwide.[13][14] However, the use of ATMs is gradually declining with the
increase in cashless payment systems.[15]
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A ti l
History
The idea of out-of-hours cash distribution was first put into practice in Japan, the United
Kingdom and Sweden.[16][17]
In 1960, Armenian-American inventor Luther Simjian invented an automated deposit machine
(accepting coins, cash and cheques) although it did not have cash dispensing features.[18] His
US patent was first filed on 30 June 1960 and granted on 26 February 1963.[19] The roll-out of
this machine, called Bankograph, was delayed by a couple of years, due in part to Simjian's
Reflectone Electronics Inc. being acquired by Universal Match Corporation.[20] An experimental
Bankograph was installed in New York City in 1961 by the City Bank of New York, but removed
after six months due to the lack of customer acceptance.[21]
In 1962 Adrian Ashfield invented the idea of a card system to securely identify a user and
control and monitor the dispensing of goods or services. This was granted UK Patent 959,713 in
June 1964 and assigned to Kins Developments Limited.[22]
Invention
A Japanese device called the "Computer Loan Machine" supplied cash as a three-month loan at
5% p.a. after inserting a credit card. The device was operational in 1966.[23][24] However, little
is known about the device.[16]
Actor Reg Varney using the world's first cash machine at Barclays Bank, Enfield, north London
on 27 June 1967
A cash machine was put into use by Barclays Bank, Enfield, north London in the United
Kingdom, on 27 June 1967, which is recognized as the world's first ATM.[25][26] This machine
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ATM
A
wasti linaugurated by English actor Reg Varney.[27] This invention is credited to the engineering
team led by John Shepherd-Barron of printing firm De La Rue,[28] who was awarded an OBE in
the 2005 New Year Honours.[29][30] Transactions were initiated by inserting paper cheques
issued by a teller or cashier, marked with carbon-14 for machine readability and security, which
in a later model were matched with a four-digit personal identification number (PIN).[28][31]
Shepherd-Barron stated:
"It struck me there must be a way I could get my own money, anywhere in the world or the UK. I
hit upon the idea of a chocolate bar dispenser, but replacing chocolate with cash."[28]
Blue plaque on the Enfield Barclays commemorating the world's first cash machine
The Barclays–De La Rue machine (called De La Rue Automatic Cash System or DACS)[32]
beat the Swedish saving banks' and a company called Metior's machine (a device called
Bankomat) by a mere nine days and British Westminster Bank's Smith Industries Chubb system
(called Chubb MD2) by a month.[33] The online version of the Swedish machine is listed to
have been operational on 6 May 1968, while claiming to be the first online ATM in the world,
ahead of similar claims by IBM and Lloyds Bank in 1971,[34] and Oki in 1970.[35] The
collaboration of a small start-up called Speytec and Midland Bank developed a fourth machine
which was marketed after 1969 in Europe and the US by the Burroughs Corporation. The patent
for this device (GB1329964) was filed in September 1969 (and granted in 1973) by John David
Edwards, Leonard Perkins, John Henry Donald, Peter Lee Chappell, Sean Benjamin
Newcombe, and Malcom David Roe. 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 stripe at the back. They used principles including Carbon-14 and low-coercivity
magnetism in order to make fraud more difficult.
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A
Theti lidea of a PIN stored on the card was developed by a group of engineers working at Smiths
Group on the Chubb MD2 in 1965 and which has been credited to James Goodfellow[36]
(patent GB1197183 filed on 2 May 1966 with Anthony Davies). The essence of this system was
that it enabled the verification of the customer with the debited account without human
intervention. This patent is also the earliest instance of a complete "currency dispenser system"
in the patent record. This patent was filed on 5 March 1968 in the US (US 3543904) and
granted on 1 December 1970. It had a profound influence on the industry as a whole. Not only
did future entrants into the cash dispenser market such as NCR Corporation and IBM licence
Goodfellow's PIN system, but a number of later patents reference this patent as "Prior Art
Device".[26]
Propagation
Devices designed by British (i.e. Chubb, De La Rue) and Swedish (i.e. Asea Meteor)
manufacturers quickly spread out. For example, given its link with Barclays, Bank of Scotland
deployed a DACS in 1968 under the 'Scotcash' brand.[37] Customers were given personal code
numbers to activate the machines, similar to the modern PIN. They were also supplied with £10
vouchers. These were fed into the machine, and the corresponding amount debited from the
customer's account.
A Chubb-made ATM appeared in Sydney in 1969. This was the first ATM installed in Australia.
The machine only dispensed $25 at a time and the bank card itself would be mailed to the user
after the bank had processed the withdrawal.
1969 ABC news report on the introduction of ATMs in Sydney, Australia. People could only
receive AUS $25 at a time and the bank card was sent back to the user at a later date. This was
a Chubb machine.
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ATM
A ti l Metior's Bancomat was the first ATM installed in Spain on 9 January 1969, in central
Asea
Madrid by Banesto. This device dispensed 1,000 peseta bills (1 to 5 max). Each user had to
introduce a security personal key using a combination of the ten numeric buttons.[38] In March
of the same year an ad with the instructions to use the Bancomat was published in the same
newspaper.[39]
In West Germany, the first ATM was installed in the 50,000-people university city of Tübingen on
May 27, 1968, by Kreissparkasse Tübingen. It was built by Aalen-based safe builder Ostertag
AG in cooperation with AEG-Telefunken. Each of the 1,000 selected users were given a
double-bit key to open the safe with "Geldausgabe" written on it, a plastic identification card, and
ten punched cards. One punch card funct
