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ATM Full Form

ATM Full Form

Full form of ATM

What is the full form of ATM?

The Full form of ATM is Automated Teller Machine (Banking and Finance).

Another full form of ATM is Asynchronous Transfer Mode (Information Technology).

Automated Teller Machine

Automated teller machine (ATM) is an electronic telecommunications apparatus, which permits the clients of financial institutions (e.g., banks) to execute monetary transactions, such as cash withdrawals, deposits, fund transfers, or account information inquiries, anytime around the clock without having direct interaction with the staffs of that financial institute (e.g., bank employees).

The basic ATMs are equipped with only one option, cash withdrawals. The advanced ATMs apart from cash withdrawals have multiple functionalities including cash dispensing, PIN generation, cheque deposition, fund transfer, balance inquiry, mini statement generation, bill payment, and mobile recharge.

How do ATMs function?

In simple words, ATM is a data terminal consisting of two input and four output devices.

    Input devices — Keypad and Card reader

    Output devices – Display screen, Speaker, Cash dispenser, and Receipt printer

Input Devices

Card reader

This input device reads securely stored data from the magnetic stripe on the back of the ATM card (i.e., a plastic card provided by the bank or financial institute with personal banking information encoded). Once the card is put into the card reader (either by swapping or dropping) this device reads the account information and transfers it to the server (host processor). The server utilizes this information to route the transaction to the cardholder’s bank or financial institute.

Keypad

When the system recognizes a card is inserted or swapped into the card reader it asks the consumer to enter the Personal identification number (PIN is a 4 digit security number provided by the bank with the ATM card. PIN number is changeable, you can modify it according to your suitability). The PIN number is sent in the encrypted form to the server. If the PIN is found correct, the system suggests further options, like withdrawal, balance inquiry, amount of cash, receipt required or not, etc. (the names of the functions are diverse and varies from one ATM model to another). Besides the aforementioned functions, the keypad can help the cardholder to cancel a transaction or correct it.

ATM Clip Art, ATM working principal, Different parts of ATM

Output Devices

Speaker

The speaker offers the consumer help with audio feedback when a key is pressed or alerts about the success or failure of an operation.

Display screen

The screen visibly shows the cardholder every step of the transaction process when he provides inputs or the outcome of his/ her requests. CRT or LCD screens are the most common visual devices that ATMs are endowed with.

Receipt printer

This small output device attached to ATMs prints a paper receipt with all details of the transaction. It also provides the customer a physical proof if a transaction is failed or disputed due to some technical error.

Cash dispenser

It is the main output device of the ATM as it dispenses the cash. The cash dispenser has a special high precision sensor that counts each banknote. This mechanism takes information about the specified number of the bills (number, entered by cardholder) and passes the bills to the special sensors. These sensors verify banknote authenticity and check whether or not banknotes are flocked together and dispense the correct amount of cash as required by the user. All the activity information is recorded in a special journal.

Working Principle

Once the cardholder wants to execute a transaction, they need to hold their cards into the card reader and provide the ATM system with all the compulsory information. The ATM system transfers the data to the host processor, which transmits the operation request to the user’s bank or financial institute. When a consumer requests cash, the host processor submits an electronic funds transfer request from the user’s bank account to the host processor’s account. The processor sends an approval code to the ATM system and directs for cash dispensing if the money had been successfully transferred from the user’s bank account to the processor’s account.

ATM workflow

Different names of ATM around the world

  • Automatic Teller Machine (ATM) - United States
  • Automated Banking Machine (ABM) – Canada
  • Cashpoint, Cash Machine and Hole in the wall - British English,
  • Any Time Money, Cashline, Nibank, Tyme Machine, Cash Dispenser, Cash Corner, Bankomat, or Bancomat – different regions.
  • "White-Label" ATMs - ATMs that are not operated by a financial institution are known as.

Origin of the ATM

Adrian Ashfield invented the rudimentary idea of a card linking the key and user's identity (February 1962). A UK Patent was granted (No. 959,713) for "Access Controller" to W. S. Atkins & Partners who employed Ashfield (June 1964). It was initially projected to dispense petrol but the patent covered all uses.

The first ATM of the world was installed at the Barclays Bank of London (27th June 1967). The first ATM that was used to dispense cash for customers was installed by Chemical bank at New York (USA) (1969). In India, the first ATM was installed by HSBC (Hongkong and Shanghai Banking Corporation) (1987).

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Asynchronous Transfer Mode

In networking technology ATM stands for "Asynchronous Transfer Mode."

What is Asynchronous Transfer Mode?

In the computer world, the Asynchronous Transfer Mode is a networking technology that transfers data in packets or cells of a fixed size.

ATM uses 53-byte cells (5 bytes for the address header and 48 bytes for the data). These enormously tiny cells are processed through an ATM switch sufficiently fast to sustain data transfer speeds of over 600 Mbps. The ATM technology was aimed at the high-speed transmission of all types of media starting from basic graphics to full-motion video. As the cells are very tiny, the ATM apparatus is able to transmit humongous amounts of data over a single connection while guaranteeing that no single transmission is using up all the bandwidth. It further permits the Internet Service Providers (ISPs) to allocate limited bandwidth to each consumer. Although this apparently looks like a disadvantage to the consumer, it essentially improves the efficiency of the ISP's Internet connection. As a result, the overall speed of the connection becomes faster for one and all.


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