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It is also called a cash machine in certain places it mainly performs actions such as withdrawing cash, depositing cash , transfer of funds etc. These functions can be done from any automatic teller machine without any direct contact with the bank staff in person.
The initiation of an idea based on out-of-hours cash distribution and an auto deposit machine was thought of and brought forward by Luther George Simjian. He saw the need of bankers in the UK, Sweden and Japan regarding out of hours cash. It did not have the features for dispensing cash but it accepted coins, cash and cheques.
History
The first actual cash machine was brought into use by the Barclays Bank of England. It was presented on 27th June, 1967. It was situated in Enfield Town of North London. The method of transaction was to use a paper cheque which needed to be issued by the teller or cashier. These machine’s cheques had carbon-14 stripes for the machine to read it and provide secure transactions for that cheque. The futuristic models had 4 digit PIN codes.
However there is a small confusion regarding the Automated version of the machine. According to records The Barclays-De La Rue machine (DACS) was the first automated teller machine . It had beaten the Swedish saving banks by launching the technology just 9 days before them. Another competitor, which was Westminster Bank’s-Smith Industries- Chubb system, had been late by a month when compared with the Barclays-De La Rue machine.
Functions
The functions of the Automated Teller Machine are as follows :-
Payment of taxes, fees, phone bills, etc.
Bank statements of a customer’s account can be printed or ordered.
Passbook updates
Payment of credit balance of a card from that account
Transferring of funds between two accounts
Currency recognition along with its acceptance and exchanging
Cheque processing methods , etc.
Network
Nowadays ATMs are connected through the interbank networks. These interbank networks connect the Automated teller machine with different banking servers which help in withdrawing and depositing money through the machines even if the money is from any other bank. Withdrawal of cash in places with different currency than the home bank is also possible because of this network.
Examples:- NYCE, BancNet, AFFN MegaLink etc.
The selection of networks varies from bank to bank. There is no universal network for any bank.
Security
In the machines earlier days the security of the device was always questioned because of it being so new to the people. These are the types of security an ATM requires :-
Physical – The Automated teller machine was vulnerable to physical attacks. Therefore after a few attacks where thieves used to break the machine and carry on their theft. Apart from guards, there was a system which used a sensor for explosive gas detection for detecting explosive gas and for neutralising it by releasing an explosion suppressive chemical which changes the composition of the explosive gas and reduces its harmful capabilities.
Transactional secrecy – The ATM transactions and their secrecy mainly depends on its integrity of a secure crypto processor. Every ATM usually uses general components which sometimes are considered not to be “trusted systems”.
Customer identity secrecy – Many people used fake keypads and attached them over the keypad of the ATM keypad and hence it leaked the data of some users. But systems were developed so that 99.99% of such devices can be caught.
Customer security – A customer can be in trouble and can be forced to withdraw money at gunpoint and for these types of circumstances every ATM should have an emergency code for the customers security.
Encryption and jackpotting – Jackpotting is the process of stealing money from the ATM using some loopholes. Encryption of the hard drive in the machine can reduce the chances of jackpotting by providing a secured hard disk.
Conclusion
It is very hard for today’s generation to think about the day-to -day life without the automated teller machine. ATMs have become the go to device because now the quantities of ATMs have increased and we can find one around every time. They have even become more reliable than they were before so people included them into their lifestyle.
