Tag Archive for: atm transaction processing

ATM Business Basics Part I: How ATMs Work

Running an ATM business is a relatively simple endeavor. However, there’s some ground level knowledge that you need to be a successful ATM owner. A big part of that knowledge base is how ATMs work.

While you don’t need to be an ATM technician (you can always pay one to service your ATMs if you need), it’s important to have basic working knowledge of your ATMs. That way you can identify and solve minor problems, and quickly add cash or refill the receipt paper. This makes your ATM business more efficient in terms of both time and expenses.

So, welcome to our two-part guide that will give you a solid foundation of information on which to build your ATM business. We’ll start with the basics of how ATMs work.

How ATMs work

As the name suggests, an ATM (Automatic Teller Machine) a banking terminal where users can perform a variety of banking activities, depending on the capabilities of the ATM machine itself.

Inserting a debit card or credit card that offers cash advances activates the ATM. The ATM authenticates the debit or credit card using a PIN number, electronically debits the cash amount from the user’s account, and dispenses that withdrawal as cash.

On the backend, the bank reimburses the ATM owner for the cash taken from the ATM, plus a transaction fee, which is paid by the ATM user. This is handled electronically by the ATM processor.

That’s the basic process. These are the parts involved in this process.

The parts of an ATM machineThe Parts of an ATM Infographic

We’ll cover these quickly in two groups: the parts that the user sees, and the parts that you, the ATM owner, need to know.

These are the user-facing parts involved in an ATM transaction:

Display (LCD or LED): The display is where the prompts and instructions are shown to the ATM user. ATM machines are equipped with braille and audio devices (speaker or headphone jack) for blind customers.

Keypad: The keypad is simply a grid of buttons that accepts input from the user. Many ATM machines also have buttons on the sides of the screen for making certain selections

Card reader: This accepts the user’s debit or credit card and reads the information on it.

Cash dispenser: This is where the magic happens. The cash dispenser gives customers their cash. The cash dispenser also checks notes for proper size and thickness and ensures that the correct number of bills are given.

Receipt printer: This part prints the receipt that verifies the transaction, and sometimes shows the user’s account balance.

These are the parts of an ATM that the customer interacts with. You as the ATM owner need to be familiar with these parts. However, the ATM owner also needs to know their way around the internals of an ATM machine, even if they’re not an expert in repairing or replacing those parts.

These are the internal parts of an ATM machine:

ATM mainboard: The mainboard is the central “computer” for the ATM. The CPU, RAM, and connection interfaces for the other components live here.

Power supply: Connects to an external power source and provides power for all the ATM machine components.

Modem: The modem performs all the internet communications required for transaction processing. This can be wired or wireless. It depends on how the ATM connects to the internet.

I/O board: The I/O board is in charge of communicating with the ATM processor, and ensuring that the correct information is sent to the correct parties.

Cassette: The cassette is an important part for the ATM owner. The cassette holds the cash. When you stock an ATM with money, this is where the bills go. The cassette can be fixed or removable. Each type of cassette has pros and cons. Which one you use depends on your business and the ATM location.

How Does an ATM Machine Work?With all the parts covered. Here’s a more detailed look at how an ATM works:

  1. The user activates the ATM by inserting their card.
  2. The customer enters their PIN and selects how much cash they want using the keypad and display.
  3. The mainboard collects the information and sends a unique EMV transaction code to the I/O board.
  4. The I/O board packages up the transaction information for the ATM processor and the modem transmits it to the appropriate ATM processing networksYour card’s supported networks are printed on the back. Every card is required by law to have two accessible networks. The transaction is completed through the secondary network if the first network fails.
  5. The ATM processor sends the withdrawal request to the bank. The bank approves or denies the request. If the transaction is approved, the message is sent back through the ATM processor to the ATM. Then, the selected amount gets debited from the customer’s account. Associated transaction fees are usually paid from the customer’s account.
  6. The modem and I/O board receive the approval. And, the mainboard initiates the cash dispensing. The cash dispenser checks each bill to ensure that it’s the proper size and thickness and that the correct number of notes gets dispensed. Notes that are not the proper size or thickness get sent to the reject bin. This happens occasionally with old or torn bills. The cash dispenser automatically dispenses a different bill any time a note is sent to the reject bin.
  7. The customer takes their cash and has a great day!

Those are the nitty-gritty details of how ATMs work.

It’s helpful to know these fine details as an ATM owner. Being more familiar with the machine helps with basic troubleshooting, and makes life easier if you get technical support over the phone.

However, you should be very familiar with the cassette and user interface. Inspect these each time you restock your ATM. You need to fix your machine ASAP if the user interface is malfunctioning or cash is being dispensed incorrectly. You lose money whenever your ATM isn’t working.

Whenever you fill your ATM with cash, it’s best to perform a transaction to verify that your machine is working correctly.

Front to back

That’s the frontend of an ATM business. In the next part, we’ll talk about what happens on the backend and where all the transaction fees go. Stay tuned. Or learn more about building your own ATM business (and how you make money).


Tag Archive for: atm transaction processing

ATM Processing Explained

ATM Processing Explained

Whether you already have ATM Processing or are just starting in the ATM Business and you’re looking for an ATM Processing Company, ATM Depot can help. We’ll unlock the secrets of ATM Processing so you can be successful with your ATM machines.

ATM Depot specializes in ATM Processing, Sales, Service, and IAD Support.

There is no magic to processing ATM transactions or running your own ATM Business. It’s all about the numbers and we’re here to support you. Give us a call and we’ll let you know if we think you have a good location.

We can also help you figure out what you can expect to make from ATM processing with your Machine.

Start Earning Residuals and Passive Income Now!
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ATM Processing Connectivity Options

When ATMs first became popular in retail stores, they handled transactions via a standard analog dial-up operation. This connection uses a phone line. However, most ATMs now come equipped with an RJ45 jack to communicate via the Internet. This makes the ATM ready for Ethernet connections to an ISP (Internet Service Provider) for processing.

With cellular device pricing and monthly fees coming way down, we now offer wireless service at unbeatable pricing. This way, your ATM communications are in your control and not the location’s control. This gives you maximum uptime. Wireless service makes the need for a phone line or relying on a slow or intermittent merchant internet service a thing of the past.

  • Our new wireless system gives you remote capability for any ATM anywhere. Now you can turn most late model ATM Machines into a Mobile Cash Machine. For example, you can install an ATM in an enclosed trailer (ask us to tell you how) to bring them to fairs and weekend events. You can set up an ATM Machine where phone service was previously unavailable. Ask us if wireless device services are available in your area.

ATM Machine Ethernet Connectivity

An Ethernet connection on ATM machines also allows retailers with reliable Internet service to process ATM transactions without adding a phone line or a wireless device. As a result, this saves the additional monthly phone line expense. Processing internet transactions usually take under 8 seconds. This is fast compared to processing phone line transactions. A phone line transaction can typically take at least 20 seconds to complete before the machine dispenses cash. In short, internet transactions are a great option for busy ATM locations as long as the ISP and connection are reliable.


The typical ATMs you see in retail stores, hotels, restaurants, night clubs and all over the US are (mostly) Free Standing ATM Machines. All Free Standing ATM Machines can be set up with ATM Depot as your atm processing company. Regardless of where you purchased your equipment ATM Depot can still handle the transactions on your ATM.

Some of the popular brands from the late 1990s through today have been:

Hyosung Halo II w/ Screen Ad
  • Hyosung Halo II – one of the most popular late model ATM’s
  • Nautilus Hyosung – (ATM Equipment and processing available)
  • GenMega (ATM Equipment and processing available)
  • Triton ATM Machines – (ATM Equipment and processing available)
  • Tranax (formerly Cross), Now owned by Hantle Manufacturing and called Hantle ATM – (ATM Equipment and processing available)
  • WRG ATM Machines – (ATM processing available for certain models)
  • Tidel ATM Machines – (no processing available, no longer compliant, purchased by NCR)
  • NCR Discontinued the product line
  • Do not buy used Tidel ATMs as they are no longer compliant

If you have an ATM and would like to switch your ATM processing to ATMDepot.com contact us today. You’ll receive the same 365-day support that we’ve been providing our IAD’s and retail customers since 2003. Switching your processing is fast, easy and free.

If you’re an IAD interested in getting started in the ATM business, the fastest way to get started is by downloading our free PDF. If you are a retailer and need immediate assistance call us at 888-959-2269. Similarly, you can complete our inquiry form and we will contact you the next business day.


Our ATM processing center operates an extensive settlement and accounting system that assures prompt, accurate delivery of funds to the owner of the machine. The system also includes detailed monthly processing reports. In other words, processing reports show down to the transaction level on a daily basis via the Internet.

Real Time ATM Monitoring should be available from your ATM Processing Company

You will also be able to log in to a secure area to see your transactions, balances, and more in real-time. A separate monthly merchant statement is also sent electronically at no additional charge. Also, the statement breaks down all the processing details for the month.

The management reporting and residual accounting for all transaction processing is able to support multiple-party revenue sharing among merchants and other business partners when needed. To clarify, if you have one or more ATMs processing transactions and you need to pay more than one person or entity from the income, we can do that for you at no additional charge.

Real-Time ATM Processing Company with Online Monitoring Included

Our ATM Portal provides fast and convenient access to real-time ATM transaction information. This online information delivery tool, created exclusively for our customers, is all available 24 x 7 365. Via a secure real-time monitoring link, all ATMDepot.com customers can now enjoy seeing live processing information. In conclusion, you can view daily and monthly terminal reports, view real-time transaction processing, review and research inquiries, and download processing data into customized reports.

Are you ready to get started processing ATM transactions and make more money?

Click to Contact Us or Call 888-959-2269 Now