ATM meaning,uses, functions,advantages and disadvantages of ATM

Automated Teller Machine: 

ATM  is an electronic fund transfer terminal capable of handling cash deposits, transfer between accounts, balance enquirers, cash withdrawal and pay bills. ATM is designed to perform the most important functions of bank. It is operated by plastic card with its special features. The plastic card is replacing Cheque, personal attendance of the customer, banking hour’s restrictions and paper based verification. These are debit cards. ATM itself can provide information about customer account and also receive instructions from customers ATM cardholders. The online ATM enable the customer to avail banking facilities from anywhere. It maybe online or offline.

                     

Advantages of ATMs:

To the customers:  

• Offer flexibility of cash withdrawal to the customer.

• Offer anywhere banking facility.

• Allow privacy in transactions.

• Are errors free.

• Offer quicker and efficient service.

To the banks:  

• Increase market penetration. 

• Alternative to opening new branches.

• Reduce operating new branches. 

• Helps banks to avoid transportation of cash and cash handling by the employees.

Disadvantages of ATMs:

• Set-up fee to install and network the ATMs.  

• Monthly or annual service fee for support.  

• Communications charges for dial-up, leased lines, or wireless data links.

Functions Performed by ATM:

• Pin change

• Balance Inquiry

• Cash withdrawn 

• Cash Deposit

• Fund Transfer

•  Mini-Statement  

TYPES OF ATMs: There are some types of ATMs.

Onsite ATM:
it is situated either within the branch premises or in very close proximity of the branch.

Ofsite ATM:
It is not situated within the branch premise but is located at other places, such as shopping centers, airports, railway and petrol stations.

Worksite ATM:
it is located within the premise of an organization and is generally meant only for the employees of the organization.

Cash Dispenser:
It allows only cash withdrawal, balance enquiry, and mini statement requests. Unlike an ATM, CD cannot be used for depositing cash or cheques.

Mobile ATM:
It refers to an ATM that moves in various areas for the customers. Few private banks have introduced ATM on wheels.

USES OF ATMs:

• Paying routine bills, fees and taxes.
• Donating to charities.
• Games and promotional features.
• Purchasing.
• Deposit currency recognition, acceptance and recycling.
• Printing bank statements.
• Updating passbooks.
• Loading monetary value into stored value cards.