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Automatic teller machine

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An automatic teller machine (ATM) is a machine permitting a bank's customers to make cash withdrawals and check their account balances at any time and 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.

ATMs are known by a wide variety of names, some of which being more common in certain countries than others. Some examples are:

  • Automated Teller Machine
  • ATM Machine [sic]
  • Hole-in-the-wall
  • Cash Dispenser
  • Cash Machine
  • Cashpoint (in England particularly)
  • Bancomat or Bankomat (particularly in continental Europe)

The world's first ATM was installed in Enfield Town[?] in the London Borough of Enfield, London on June 27, 1967.

In modern ATMs, customers authenticate themselves by using a plastic card with a magnetic stripe, which encodes the customer's account number, and by entering a numeric passcode[?] called a PIN (Personal Identification Number), which may be changed using the machine. Typically, if the number is entered incorrectly several times in a row, most ATMs will retain the card as a security precaution to prevent an unauthorised user from working out the PIN by pure guesswork.

Most ATMs are connected to interbank networks[?], enabling people to withdraw money from machines not belonging to the bank where they have their account. (Deposits can only be made at machines belonging to the bank that has the account.) This is a convenience, especially for people who are travelling: 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. Many banks charge fees for the use of their ATMs by non-depositors, for withdrawals over the network by their own customers, or both. There is also now a flourishing business in the United States of placing ATMs in grocery stores, malls, and other locations other than banks: some of these machines have signs advertising "low" fees.

ATMs contain secure cryptoprocessors, generally within an IBM PC compatible host computer in a secure enclosure. The security of the machine relies mostly on the integrity of the secure cryptoprocessor: the host software often runs on a commodity operating system.

Early ATM security focused on making the ATMs invulnerable to physical attack; they were effectively safes with dispenser mechanisms. A number of attacks on ATMs resulted, with thieves attempting to steal entire ATMs by ram-raiding.

Modern ATM physical security concentrates on denying the use of the money inside the machine to a thief, by means of techniques such as dye markers and smoke canisters. This change in emphasis has meant that ATMs are now frequently found free-standing in places like shops, rather than mounted into walls.

ATM transactions are usually encrypted with DES but most transaction processors will require the use of the more secure Triple DES by 2005.

In store ATMs typically connect directly to their ATM Transaction Processor[?] via a modem over a dedicated telephone line, although the move towards Internet connections is under way. Along with the move to the internet, ATMs are moving away from custom circut boards (most of which are based on Intel 8086 architecture) and into full fledged PCs with commercial operating systems like Windows 2000 and Linux. A good example of that is Banrisul, the largest bank in the South of Brazil, which has replaced the MS-DOS operating systems in its automatic teller machines with Linux.

ATMs are generally reliable, but if they do go wrong customers will be left without cash until the following morning or whenever they can get to the bank during opening hours. Of course not all errors are to the detriment of customers; there have been cases of machines giving out money without debiting the account or giving out a higher denomination of note by mistake.

There are also many "phantom withdrawals[?]" from ATMs, which banks often claim are the result of fraud by customers. Phantom withdrawals are considered to be a problem generated by dishonest insiders by most other observers. Ross Anderson, a leading cryptography researcher, has been involved in investigating many cases of phantom withdrawals, and has been responsible for exposing several errors in bank security.

See also:

External Links

Some ATM Manufacturers



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