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What is meant by an Automated Teller Machine (ATM)?

Updated on June 21, 2022 , 524 views

Automated Teller Machines, popular as ATMs, are the most valuable and necessary banking field advancements. An ATM enables people to make various banking transactions and check the banking and account details without taking help from an actual teller.

Automated Teller Machine

Additionally, with an ATM, customers can also access various banking services without visiting the Bank branch. Most of the transactions in an ATM are done using cards, but a few can also be done without them, like withdrawing money from ATMs using net banking instead of using cards as introduced by SBI, ICICI Bank, and others.

Advancement in the banking sector made the financial lives much easier for everyone. With the help of ATMs, customers are no longer required to visit the bank branch for every minor purpose and take simple banking actions like cash withdrawal, balance inquiry, etc. Furthermore, automated teller machines are widely found in every corner of the world.

Types of Automated Teller Machines

There are two main types of automated teller machines. The primary unit machine is the one that allows customers only to withdraw cash and receive the updated account details for their bank accounts.

In contrast, the complex ATMs also accept deposits from customers and allow line-of-credit payments and transfers. Customers can also retrieve the updated account details using complex ATMs.

For the bank customer to use the complex machines and the advanced features offered by them, they must have a bank account with the bank that operates the machine. Analysts also believe that the ATMs will increase in popularity, and there will also be a rapid increase in the number of ATM setups and withdrawals using these machines.

Furthermore, in the future, ATMs might also have full-service terminals and traditional bank tellers.

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Features of an Automated Teller Machine

Even though there is a difference in the ATM of each bank, there are certain essential parts that are common in all of them, like:

  • Card reader: This is the part of the ATM that reads the chip available on the card’s front, or it might also read the magnetic stripe available on the back of the card.
  • Keypad: It is available on an ATM to help customers enter the required details for making any transaction. Using the keypad, customers fill their ATM pin, transaction type, the amount for withdrawal or deposit, etc.
  • Cash dispenser: This is a slot in the ATM from where the bills are dispensed. It is located below the screen, at the bottom of the machine.
  • Printer: It helps print the receipts if asked by the customers. The printed Receipt includes the transaction type, transaction number, account balance, and other details.
  • Screen: It is the part where the ATM issues some prompts to guide customers through the execution process while making any transaction. All the details, including the inputs and outputs, are also visible on the screen.
All efforts have been made to ensure the information provided here is accurate. However, no guarantees are made regarding correctness of data. Please verify with scheme information document before making any investment.
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