ATM Full Form

ATM Full Form is an Automated teller machine. It is an electro mechanical machine, basically used by only bank customers to withdraw cash. This machine has evolved as the substitute of manual operation of financial institutions for functions like withdrawing money, depositing, transferring funds or obtaining account information, being accessible to customers for 24*7 around the world.

ATM Full Form

ATM was invented by Scottish inventor Shepherd-Barron. The first ATM was set up on June 27, 1967 at a branch of Barclays bank in Enfield, North London

In India, the concept of the ATM was first established by HSBC in the year 1987.

There are more than 3.5 million across the world.

This article includes the full form of ATM and briefing about its structure, process of work, function, advantages and disadvantages.


An ATM typically constitutes the following parts- 

  • Card reader– This part reads the chip on the front or magnetic strip on the back of the card.
  • Keypad– It allows the consumer to input information like pin, account type, amount of transaction.
  • Speaker– Plays the sound according to the corresponding key.
  • Cash dispense– It is the heart of an ATM machine. Cash is dispensed through a slot in the machine which is connected to the safe at the bottom of the machine.
  • Printer: The consumers can request receipts recording the type of transaction, the amount, and the account balance which are printed here.
  • Screen: Its acts as a guide for the users by displaying written commands. and the transaction information .

ATM networking

 The internet service provider (ISP) plays an important role in the ATMs. This provides communication between ATM and host processors. When the transaction is made, the details are shared by the card holder. This information is passed on by the ATM machine to the host processor. The host processor takes these details to authorized bank. Once the details are matched, the host processor sends the approval code to the ATM machine so that the cash can be transferred.

ATM Security

The ATM card is secured with PIN number which is kept with only the user. There is no way to access the PIN number from your card. It is encrypted by the strong software like Triple data Encryption Slandered.

Types of ATM

  • On site ATM– It is set up within the bank premises and performs other functions, along with cash withdrawal.
  • Off site ATM– It is located outside the bank premises, basically meant for withdrawal of money  
  • Worksite ATM– It is located inside the workstation and is generally meant for the employees of the organization.
  • White Label ATM –it is owned and operated by a non-banking entity and cash is offered by the sponsored bank
  • Brown label ATM- it is owned by the bank but its operation and maintenance is outsourced to another entity. 

Withdrawal limit

Every bank has their prescribed limit of withdrawal starting from Rs20000.

Fee-It is chargeable to use ATM of banks other than the issuing bank to make transactions. Generally, a certain number of transactions are allowed free by the issuing bank. However, you are charged for using the ATMs of other banks for transactions beyond a certain number which may vary from one issuing bank to another. These charges vary between banks.

However with growing use of ATM by the public, there have been persistent demands to change the ATM charges and fees

Advantages of Automated Teller Machine:

ATM is an integral part of cashless economy. A bundle of notes has been replaced by a single card.

  •  The ATM provides 24 hours service.
  •  The ATM provides privacy in banking communications.
  •  The ATM has minimized the workload on the banks staff.
  •  The ATM is very beneficial for travelers, especially when they out for a foreign trip.
  •  The ATM provides services without any error.


  • It can be risky if one lost his/her ATM card and found by criminals.
  • It may take time to transact in case someone forgets his/her PIN.
  • It may cost to the person if he shares his/her PIN with someone.


ATM Full Form is an Automated teller machine. It is an electro-mechanical machine, basically used by only bank customers to withdraw cash. It allows you to withdraw money, deposit, transfer funds or obtain account information. ATMs are accessible to customers for 24*7 around the world.

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