ATM full form is Automated Teller Machine. in the old banking system, customers visit physically to a bank branch for deposit/withdrawal transaction where a person (teller) record the transaction manually and give/take money to/from the customer. In modern banking, ATM(an electromechanical cash dispenser machine connected with a bank computer server. These ATM machines are installed in different geographical locations across the world by various banks. Now the customer is not required to visit the bank branch physically. Customers go to the nearest ATM for their transactions.
How does ATM work:
ATM is equipped with appropriate software and it is connected with bank’s server. Customer is required to insert debit/credit card issued by bank into ATM and password. ATM authenticates the identity of customer by connecting with bank server. If customer is authorised for withdrawal transaction, ATM give the cash to customer according to available balance in customer’s account.
There are two types of ATM:
Commonly, most of the ATMs performs only withdrawal transactions .
More complex type of ATM can also perform deposit transactions.
Components of ATM:
- Card reader:ATM card/debit card contains a magnetic strip on back side. This magnetic strip
Stores required information. Card reader reads this information for processing.
- Keypad: there are several keys on keypad for user to enter password.
- Cash dispenser: After authentication , cash despiser gives cash to the user.
- Printer:printer is installed in ATM to print the receipt of transaction or mini statement.
- Screen:user can view all the available options for user on screen and select required one.
In this modern era where every person is busy in his daily life. ATMs are very helpful because user can perform secure transaction at the nearest ATM without visiting the bank branch.ATM provides it’s services 24 X 7. That’s why ATMs are successful throughout the world.