Automated Teller Machine (ATM)

An automatic teller machine or automated teller machine (ATM) is an electronic device that allows a bank's customers to make cash withdrawals and check their account balances without the need for a human teller. Many ATMs also allow people to deposit cash or cheques, transfer money between their bank accounts or even buy postage stamps.

The world's first ATM was produced by NCR in Dundee, Scotland, and installed in Enfield Town in north London on June 27, 1967 by Barclays Bank. This instance of the invention is credited to John Shepherd-Barron, although George Simjian registered patents in New York, USA in the 1930s and Don Wetzel and two other engineers from Docutel registered a patent on June 4, 1973. Shepherd-Barron was awarded an Order of British Empire in the 2005 New Year's Honours.

Early cards were retained by the machine and worked on various principles including radiation and low-coercivity magnetism that was wiped by the card reader to make fraud more difficult.

Modern ATM banking was tested in New Zealand's Christchurch region before being rolled out elsewhere as a banking service.

In modern ATMs, customers identify themselves by using a plastic card with a magnetic stripe, which encodes the customer's account number, and by entering a four-digit pass-code called a PIN (Personal Identification Number), which in some cases may be changed using the machine. If the number is entered incorrectly several times in a row (with three attempts as the most common), most ATMs will retain the card as a security precaution to prevent an unauthorized user from working out the PIN by pure guesswork (it should be noted sometimes these cards are later on destroyed to prevent the bank staff from misusing them). Earliest versions accepted a single-use token or voucher, and the latest ATMs read and store customer

data on a smartcard.

Most ATMs are connected to inter-bank networks, enabling people to withdraw and deposit money from machines not belonging to the bank where they have their account. This is a convenience, especially for people who are traveling: it is possible to make withdrawals in places where one's bank has no branches, and even to withdraw local currency in a foreign country, often at a better exchange rate than would be available by changing cash.

ATMs rely on authorization of a transaction by the card issuer or other authorizing institution via the communications network.

This course will introduce various principles of working of ATMs and explain the important functions in detail under the following topics

l ATM connecting mode.

l ATM network protocol.

l ATM network application protocol.

l ATM network security mechanism.