1. Executive Summery
ATM means Automated Teller Machine. Most historians
agree that Barclay’s in the London was the first to deploy an
ATM in 1967. It wasn’t until the mid to late 1980s that ATMs
gained wide acceptance. Automated teller machine is those
machines, which are used within, or outside the bank premises
for cash payment and other transaction related services without
intervention of human bring. ATM have progressed from being
merely cash dispensers to provide facilities for deposit balance &
reporting & inter account transaction
The structure of ATM as follow (1) Processor (2)
Consumer interface panel (3) card reader (4) Printer (5)
dispenser (6) Depositor
There are over 1.2 million ATMs installed worldwide.
Approximately every 5 minutes a new ATM is installed. The
ATM is one of the most important technological inventions of
the second half of the twentieth century, helping to crate the 24
X 7 all hours’ access to their own-banked cash near to where
they live, work and shop.
According to recent data from the Dove Consulting on
ATM terminal deployment, financial institutions lose an average
of $ 242 per month on each of their off-premise ATMs. In fact,
between 2001 and 2003, revenues generated by off –premise
ATMs fell by 11%. This report demonstrates the popularity the
Full services outsource model has gained among small to mid-
size bank deployers. According to the report, 7% of large banks
and 13% of other banks use service model while 13% of large
credit unions and 18% of other credit union employ this method
as well.
Despite the challenges ATM management poses to banks
and credit unions, ATM networks are proven to help attract new
customers and promote self-service banking and convenience.
If you should ever be forced by a robber to withdraw
money from an ATM machine, you can notify the police by
entering Pin # in reverse.
1

2. Cash machine crime has risen despite leading banks
investing millions of pounds in anti-skimming technology.
Reserve Bank Of India’s Guideline for issue of ATM-
cum-Debit Cards by UCBs. Banks which are authorized to install
on-site / off- site ATMs, as per the policy in force, may introduce
ATM-cum- Debit cards with the approval of their Board keeping
in view the guidelines as given in Annex I. A report on the
operations of these cards issued by banks should be forwarded to
the RBI, Department of payment and Settlement System (DPSS)
with a copy to the Regional office concerned of RBI on a half
yearly basis, say at the end of March & September every year,
incorporating information as indicated in Annex II.
Benefits of Biometric supported ATMs Provide strong
authentication. Hidden costs of ATM card management like card
personalization, delivery, management, re – issuance, PIN
generation, help-desk, and re- issuance can be avoided. Ideal for
Indian rural masses.
2

3. Introduction of ATM
The growth of technology has changed the payment
System world over during the past two decades. More and more
innovations are being introduced in both cash payment system
and non-cash payment systems. Cash in the form of notes and
coin was the principal method of payment system before the
introduction of ‘Banking’ paper instruments such as ‘Cheques’
and ‘cash Transfer’ now have become a part of the payment
system with the popularity of banking. Electronic devices are
making the job of cash payment as well as non-cash payments
easy and efficient.
ATM mean Automated teller machine, which is used
within or outside the bank premises for cash payments and other
transaction, related services without intervention of human
being. ATM is installed in different forms as wall unit, window
unit or lobby unit depending upon the location and the need of
target customers.
The introduction of Automated teller Machine and plastic
card has given the banking customers the facility of round the
clock banking. In this Unit, we will discuss about the various
types of teller machines prevalent in the banking industry and
how they are instrumental in replacing our traditional payment
systems.
Some ATMs allow withdrawal funded by clerical staff in
retail merchant location. The clerical staff are not considered
bank teller. Many ATMs also allow people to deposit cash or
cheques, transfer money between their bank accounts, top up
their mobile phones’ pre-paid accounts or even buy postage
stamps
3

4. History of ATM
The history of the ATM often is open for debate, since the cash
dispenser's development occurred long before the machine was
put into use. Most historians agree that Barclay's in the London
was the first to deploy an ATM in 1967. It wasn't until the mid to
late 1980s that ATMs gained wide acceptance.
After MasterCard and Visa lifted their surcharge ban in 1996, the
off-premises market in the United States exploded. The United
States now has the largest ATM market, with somewhere
between 420,000 and 450,000 ATMs, in the world. Today,
worldwide ATM deployment is estimated to be 1.5 million.
Teller machine are those machine, which are used within, or
outside the bank premises for cash payment and other transaction
related services without intervention of human being. Basically
there are two type of teller machine (1) Automatic Teller
Machines (ATMs) and (2) Bank Teller Machine (BTMs)
1) Automated Teller Machines (ATMs)
Significant advantage can be availed from computerizing day-
to- day banking operations originate to the cash counter in the
banks. Before considering the aspects of computerizing these
operations, we should look at what operations are performed at
these counters.
4

5. Start
Stop
Stop
Stop
HOW DO THE ATM WORKS:
Chq.wdl
Presented for
Payment
No
Return the
Cheque./Wdl.
Is Customer
Has Account
With Bank?
Return
the
Yes No
Cheque./Wdl.
Is Sufficient
Bal. Available
To pass chq?
Return the
No
Cheque./Wdl.
Is Signature
O.K.?
Debit the A/c.
And update the
Pass book
Count Out
Cash
5

6. Pass the Cash
& Passbook
to Customer
Update branch
A/c and Cash
Balance
Stop
Flow chart 1: Manual payment system at Teller counter
Step in withdrawing money
Let’s see what typically happens when a customer wishes to
withdraw money from the bank. Assuming the customer has a
savings account with the bank with bearer cheque facility, the
customer has two option to withdraw money: with a cheque
payable to self or use a withdrawal slip along with the passbook.
The following operations have to be performed after presentation
of cheque / withdrawal slip by the customer at the counter for
withdrawal of cash.
1) To check whether the customer has an account with the
bank.
2) To check whether sufficient balance are available in the
account to permit withdrawal of the amount requested by
the customer.
3) To verify the customer’s signature with the specimen
signature stored with the bank.
4) To update the customer account with the bank and also
passbook by reducing the closing balance.
5) To count out the cash.
6) To pass the cash to the customer.
7) To update the branch account to show simultaneous
decrease in customer deposits and in cash balance.
6

7. From the customer point of view, the above process is
cumbersome to the extent that he can obtain cash only during
banking hours. Also, since the actual process takes some time to
complete the formalities, he may have to wait in a queue. From
the bank’s point of view, when the process is done without any
computerization, a considerable number of man-hours are
required to complete the process. In fact the significant part of
the time of banking personnel is spent in the activity of counting
of cash, verifying the signature, updating the ledger and
passbook etc. These are the reason why electronic payment
systems have been adopted.
The growth of technology has changed the payment systems
world over during past decades. The introduction of Automatic
Teller machines has given facility to the bank customers for
banking beyond the banking hours. An ATM is a device located
on or off the bank’s premises to receive and dispense cash round
the clock. Customers can also use ATMs for depositing cash,
cheques, obtaining balance, obtaining statement of last few
transactions in his account, requesting cheque books, payment of
card bills and for transferring funds from one account to another.
The customer is issued a plastic card in this mane. This card is
magnetically coded, so that the ATM can identify the customer.
When the customer wants to use the ATM, he inserts the the card
into the slot at the ATM window. Once the card is recognized,
the video terminal of the ATM displays the message “Type your
identification number”. This is a unique Personal Identification
(PIN) which is provided to him at the time of opening the
account and is normally known only to him. This number ensure
against other withdrawing through stolen cards. The customers
type this number on the keyboard at the ATM window. The
computer checks this number and establishes the authenticity of
the customer.
The ATM then displays the message “enter the
transaction or the amount to be withdrawn”. When the customer
gives the instructions through the keyboard the VDU displays
“your transaction is being processed. Please wait”. If cash is to
7

8. be withdrawn and there is sufficient balance, the cash output slot
pushes out the amount and also a printed statement of the
transaction, and even the present balance in certain cases. It the
customer want to deposit cash or cheques etc, the ATM releases
the cover for this purpose. Other transactions are also put
through in a similar manner. At the end of the transaction the
ATM cover closes and the machine ejects the customer’s card.
There are two types of ATMs:
1} Exterior ATMs and
2} Interior ATMs.
Exterior ATMs are located in various places like shopping
centers, airports, railway stations with or without drive in
facility, while the interior ATMs are located within the bank
premises. ATMs that are directly interactive with the Bank’s
computer are known as on-line ATMs and the others are known
as off-line ATMs. On-line ATMs require the support of effective
telecommunication facility. In some foreign Bank’s ATMs the
conversion of currency is also possible. Interactive and voice
recognizer ATMs are also installed to facilitate the customers to
interface in multi-language.
8

9. The structure of ATMs
The following modules are the part of any standard ATM.
9

10. 1. Processor
2. Consumer Interface Panel
3. Card Reader
4. Printers
10

11. 5. Dispenser
6. Depositor.
1. Processor
The processor is the main brain behind an ATM. All the
necessary interfaces with the various ATM modules are handled
b the processor. It receives commands through the Consumer
interface Panel (CIP) and decides on further actionprocessing. If
the ATM is in off-line mode, the processor will authorize the
transaction based on the balance available on the card, while if it
is on-line mode, the authorization will be based on the validation
check carried out by ATM by interacting with the central
computer.
2. Consumer Interface Panel
Consumer interface panel consists of set of devices provided to
the user/consumer of ATM service. It consists of (A) key pad,
(b) display, (c) recess for card, (d) printing unit and (e)
envelopes. The CIP guides the consumer through the transaction
and allows the consumer to enter the data. The display unit is a
high resolution monitor which displays messages/ pictures. The
display is visible only for the consumer and not to the person
nearby. Consumer keypad is recessed for privacy and it has 10
numeric keys and a cancel key.
3. Card Reader
Motorised card reader is provided on the ATMs. The magnetic
track on the cards, as soon as inserted by the consumer, is read
by the card reader. The consumer can take back the card after
completing the transactions. There is a retained card bin provided
inside the ATM, where the retain cards and the cards left behind
by the consumer by mistake are deposited.
4. Printers
There are two printers provided in the ATMs. One printer is for
the consumer and the other one is journal printer. Both are not
visible to the consumer. After the transaction is over, the purpose
11

12. and consumer picks it up. The journal printer provides an audit
trail of all completed transactions. The transaction data is also
available in electronic media.
5.Dispenser
The currency notes are stored in cassettes in the Dispenser. The
dispenser picks the currency and delivers the same to the
consumer through slot provided in the front panel. The currency
dispenser’s uses either friction pick or vacuum pick technology
depending upon the technology available with the ATM.
6). Depositor
The depositor accepts envelopes with cash or other documents
and provides security for deposited material. The deposit is made
through a separate slot provided for the purpose and the
consumer through the keypad enters the details of deposit. ATM
provides the envelopes meant for the deposits with the envelope
dispenser.
Alternative uses of ATM
12

13. ATM Project
The Bank’s ATM network includes 5479 ATMs in India, which
is the largest ATM network in the country. The Bank continues
to expand this network rapidly. Customers can transact free of
cost at the ATMs of the State Bank Group.
The agreement with VISA and Master Card International for
acquiring ATM transactions has resulted in another revenue
generation stream.
Debit Card Population
The card base of State Bank Group has grown from 7.77m in
September 04 to 12.43m in March 05 and 16.32m in September
05. Out of total card base State Bank of India has major share of
12.89m cards and remaining 3.43m cards of Associate Banks.
State Bank Debit Card with affiliation to Master Card is the
largest Maestro debit card issued by any Bank in South Asia.
Card Usage
With our bilateral sharing arrangement with UTI Bank, HDFC
Bank, Indian Bank, Andhra Bank, Punjab National Bank and
Corporation Bank, our customers have access to the largest reach
and convenience of “Anywhere – Anytime” banking at over
10,200 ATMs.While access to State Bank ATMs is free, nominal
charges are applicable on the use of other banks ATMs.
Recently, UCO Bank Canara Bank and IndusInd Bank have
signed MOU for bilateral sharing arrangements with State Bank
ATM Net Work. State Bank ATM cum Debit cards are also
acceptable at more than 1,23,000 Points of Sale / Merchant
Establishments, which display Maestro logo.
The Bank is making rapid progress in migrating customers from
teller counters. The average hit rate has increased from 189 in
March 2005 to 212 in September 2005.
13

14. Roll out of ATM Prototype
Rollout of ATM Prototype is an initiative launched in this
direction, where cards are personalized for all eligible customers
and delivered to them during their visit to branch.To help them in
acquainting themselves with the ATM usage dedicated support
from ATM Dost is provided.ATM Dost is marketing
representative of our Bank, selected from the branch staff who
acts as friend and guide to customers in delivery of cards and
educates them about its usage and advantages.The ATM usage
has been increasing continuously and average of 1 mn txns
happen every day on our network.
During the first half year of current financial year 2005-06,
Prototype has been rolled out to new 514 branches in 11
Circles.
Another 500 branches will be rolling out prototype by next
quarter 2005.
International Debit Card
The Card population of International Debit Card as on March 05
was 13470. The number has increased to 16451 as on September
2005.
24 x 7 Support through Call Center
Effective from 15th
August 2005, Call Center operations have
been shifted to M-phases and are functional from Bangalore.Call
Center is now accessible from anywhere in the country. Facility
is extended to Associate Banks customers also.Call Center is
being upgraded to Customer Care Center with added services
like Hot Listing of cards, request for re-generation of pins and
complaint redressal machinery.
Before You Use an ATM
14

15. While ATM's have added some convenience to our lives, a few
risks have also popped up. ATM's give criminals another
opportunity to get at your money, and you should take steps to
reduce your risk. Most of us can stay out of trouble with simple
common sense, but you should periodically review some proven
tactics. Follow these seven steps, and you'll improve your odds
against the scamsters.
Look Around Before You Approach
Take a quick look at your surroundings. See if anybody or
anything looks suspicious. Is anybody watching you or standing
too close?
Use ATM's That You're Familiar With
If you know an area well and have used an ATM before, you can
expect similar results. In other words, your chances of getting
robbed at a 'familiar' ATM are less than your chances of getting
robbed at a 'new' ATM. There are a variety of reasons for this,
but the point is that your odds are a lot better with a trusted
source.
Look Over the Machine Before Inserting Your Card
If you see something that looks unfamiliar on the machine, it
could be part of an ATM scam. (External readers) and hidden
cameras can be used to compromise a bank account. Bottom line:
if it looks funny, look for another ATM.
Lock Your Doors and Secure Windows at Automobile
ATM's
We've all heard the stories about carjacking. Think how much
more attractive you are as a target with cash-in-hand. When your
car is stopped and you're picking up cash, just take the half-
second required to lock the doors and keep crooks out.
15

16. Have Your Card Ready While Approaching the ATM
If you're quick, your chances are better. On the other hand,
you're exposing yourself unnecessarily if you stand around the
ATM digging through your wallet or purse for that special card.
Get it out before you leave your car or as you're approaching the
ATM and get your transaction started as soon as possible.
Use ATM's that are Well Lit and Safe
Have you ever had to swipe your ATM (or Credit/Debit) card to
get into an ATM booth after hours? One of the reasons is that
only somebody with a valid card can get through the door. This
makes it less likely that and undesirable’ will approach you just
as your cash is coming out. Obviously this is not foolproof -- a
crook can steal somebody's card and use it immediately.
Get Cash Out of Sight
This is pretty obvious, but some people need to be more
conscious. After you get your cash, get it out of sight. Whether
it's a lot of money or a little, cash can be tempting when it's out
in the open.
16

17. Fraud of ATM
Cash machine fraud up, say banks
Cash machine crime has risen despite leading
banks investing millions of pounds in anti-
skimming technology.
The banking industry says new figures, to be published next week, will show
ATM fraud is on the increase.
One in four ATMs have now been fitted with anti-skimming equipment
Criminals - many from organised gangs - stole £65m last year, by using skimming
devices that read information from the magnetic strip on the back of a card.
Deputy Information Commissioner David Smith said banks should be doing more
to protect customer information.
Mr Smith added: "Banks really do need to concentrate their attention on customer
security - it's about protecting information and the problems that customers can
face if their information gets into the wrong hands. "It's not just about protecting
the bottom line, the profits of the banking industry."
Although only one in four machines has been fitted with the new anti-skimming
equipment so far, the banking industry said it will have a "dramatic effect on
reducing cash machine fraud".
The industry also said it had witnessed an increase in cash point crime because the
new chip-and-pin system has made it harder for fraudsters to use stolen or cloned
cards in shops.
Chip-and-pin cards aim to cut fraud by including a smart chip, which can store
more information than the usual magnetic strips, and also by having users verify
transactions by keying in a pin number rather than signing a receipt.
Miniature cameras, which can record pin numbers, are also among the devices
17

18. used by fraudsters to steal cash from ATMS. Over the past two years card issuers
have been busy replacing all credit and debit cards in the UK.
Sandra Quinn, from the Association of Payment and Clearing Services (APACS)
which represents the companies which handle payments, said: "As you cut off one
route for fraudsters they exploit another.
"So as we made sure that all shops had chip-and-pin equipment, fraudsters weren't
able to use counterfeit cards there, so they doubled their efforts at cash machines.
18

19. ATM Security Information
PIN NUMBER REVERSAL
If you should ever be forced by a robber to withdraw money
from an ATM machine, you can notify the police by entering
your Pin # in reverse.
For example if your pin number is 1234 then you would put in
4321. The ATM recognizes that your pin number is backwards
from the ATM card you placed in the machine. The machine will
still give you the money you requested, but unknown to the
robber; the police will be immediately dispatched to help you.
This information was recently broadcasted on TV and it states
that it is seldom used because people don't know it exists. Please
pass this along to everyone possible.
I will post some more trading tips on 13th August.
Keep investing money only in Indian Markets...
Physical security:
ATM is totally impregnable. Currency is stored in cassettes,
which can be opened only with special jigs, which are
maintained in custody. These cassettes are placed inside the
ATM in special steel safe with a combination lock. The safe also
has an alarm, which is set-off when there are attempts to make
unauthorized entry or when the safe door is forced. The alarm
system is an electronic one, which is wired into the central alarm
monitoring system. There is also a back – up alarm system in
case of power failure.
ATM Security Manual
“An informed, security-conscious customer is far less likely to be
defrauded”. Foreword This manual is designed to ensure
optimal levels of customer safety and convenience at ATMs.
19

20. It is true that law enforcement agencies around the world need
the communities they police to play a part in the upholding of
law and order. In being more security-conscious, and taking
precautions whenever possible, citizens can help prevent crimes
from taking place. This is equally true when it comes to ATM
usage.
Therefore, we would like to appeal to all regular users of ATMs
to read this manual and practice its simple guidelines.
The Global ATM Security Alliance was formed to assist law
enforcement and fraud prevention agencies and to strengthen the
industry’s protections against criminal activity. We are proud to
present this ATM Security Manual for Customers for your
benefit. It includes “The World’s Top Twenty Tips for ATM
Use” collected from Australia, New Zealand, United States of
America, United Kingdom, Europe, Canada, India and South
Africa.
ATM Safety
Automatic Teller Machines (ATMs) have revolutionized banking
allowing customers to do their banking 24 hours a day. They
also, however, have been a great help for thieves looking for
quick cash. This workshop focuses on some of the things to be
aware of when you use your ATM.
Memorize Your PIN: Don't write it down on your card, or on a
piece of paper you store in your wallet. If your card or wallet
were stolen, the thief would have your PIN.
Be Ready for Your Transaction: have your card ready, have
your code in your head, and fill out any deposit envelopes before
you approach the ATM. Take some envelopes with you and
complete them at home or in your locked car at your next
transactions.
20

21. Be Aware of Your Surroundings: Look at the area around the
ATM; is it well lit? Is it in a remote area, or are there many cars
passing by? Are there any cars or people 'hanging out' in the
area? Is your gut instinct telling you this is a safe area? Consider
using the ATM during daylight hours, when you can see better
and others can see you better. If you must use an ATM at night,
consider one inside an open business like a grocery store.
Protect Your Code: When using the ATM, block other people's
view; don't allow others to see your code, what type of
transaction you are making, or how much money you are
withdrawing.
Lines in the Area: If there is a line behind you in the ATM and
someone is too close to you, ask them to step back. If they do not
step back, you may want to cancel your transaction and either
wait in your car, or use the ATM at another time.
Quickly Put Away Your Money: Put your money in your
wallet and put your wallet away immediately. Count your money
when you are safely inside your car or home. Before you leave
the ATM, check your surroundings - is anyone around? Also put
away your card and receipt.
Avoid Large Cash Withdrawals: If you were robbed or lost
your wallet, at least you would only lose a smaller amount of
cash.
Take All of Your Receipts With You: Don't let a potential thief
know how much money you have withdrawn or how much you
have in the bank.
If You are Driving: Park as close as you can to the ATM, and
lock your doors. Keep your keys handy so you can enter your car
quickly after completing your transaction.
Drive-Up ATMs: Assess the surroundings of the ATM - are
people 'hanging around' on foot or in vehicles? If it feels unsafe
21

22. to you, choose another ATM. Keep your doors locked. Keep all
windows up except the one you are using. Keep the car running
and keep aware of your surroundings.
Check Your Account Report: Notify your bank and the police
if you notice any suspicious or unauthorized ATM transactions
on your monthly statement.
If Your Card is Stolen: Immediately contact the police
department where you are, and contact the financial institution
responsible for the ATM card. Thieves typically have about a
four to eight hour window they can use stolen ATM and credit
cards since owners don't report them stolen right away. You may
not be liable for any items debited from your account if you
report it right away.
Bring a Friend: A thief is less likely to attempt to rob you if you
have someone with you.
If You are Followed: Go to an open business and call the
police. Provide a description and direction of travel of the person
or vehicle following you.
22

23. Self-Service Banking and ATMs in the 21st Century
"This report is clearly authoritative and comprehensive… an
excellent summary of current and future thinking." Ian Bain,
Executive Director, Atmia Europe (ATM Industry Europe)
This report is concerned with all types of self-service equipment
or customer-activated terminals, including the automated teller
machine (ATM), automated depository, and kiosk.
In practice, equipment other than the ATM is still in the
minority, and the population figures for ATMs therefore remain
the best proxy for an overall assessment of the installed self-
service base.
Many external factors (including political, economic and social)
will determine the rate of growth and nature of the global estate.
Industry consensus predicts the further automation of the
counter, the development of the kiosk, and videoconferencing, as
the self-service developments that will have the greatest impact
in the short term.
Research undertaken in the compilation of this report would
support that viewpoint.
The total global estate of ATMs reached 1.142m by the end of
23

24. 2001 (the latest date at which consolidated market data is
available) and is projected to reach a global total of 1.54m by
end 2007.
Of these, 345,000 were located in the USA, a number that
exceeded the machine populations of every other region.
For example, outside Japan, the populous and economically
dynamic Asia-Pacific region still had fewer than 200,000
machines in operation.
Members of the major payment systems organisations,
MasterCard and Visa, have access to around 800,000 ATMs
globally. (Sources: Retail Banking Research, MasterCard and
Visa)
This report looks at the development of the industry and gives
you a complete guide to the worldwide market and pays
particular attention to developments in the USA, Asia-Pacific,
Western and Eastern Europe and Africa.
24

25. How much ATM is in your future? - Information
Technology
Tom Gill, CEO of FORE Systems, looks out on a different world
from one that existed just 18 months ago. "There was a lot of
confusion 18 months ago about frame and cells and how to
deploy a backbone infrastructure and IP infrastructure for all of
your communications needs," he says. Now, network designers
have a much clearer idea of what they want to accomplish and
how to do that.
Gill says there is a shift in large enterprises from the tactical to
the strategic use of the corporate network. It is no longer
acceptable to plug in a solution and hope it works in an
environment that is close to capacity. Instead, enterprises are
looking to create an "information utility.”
"An information utility is like your electric utility or your water
service," he says. "It's always there, like your phone system. The
idea is to create that same feel for information systems. It's
ready. It's predictable. It's on demand. It's secure."
It's also scalable. The typical large company with multiple
locations wants to link up its campuses, boost capacity, run
applications over the campus backbone, and boost the edge of
the network. Furthermore, the company wants that network to be
25

26. ready for future applications--particularly those that depend on
service guarantees.
ATM can do that, Gill says. It can also serve to unify widely
scattered offices. "The wide area and remote offices can be
consolidated into their campus backbone over one infrastructure.
It's cost effective, and it makes a lot of sense."
Gill is, understandably, an advocate of the values of ATM--its
scalability and quality of service guarantees. But he doesn't
expect it to go to the desktop. Beyond the wiring closet, Gill
favors Ethernet--and FORE has bought several Ethernet
companies, including, most recently, Berkeley Networks. The
combination of the two has become the most logical way of
simplifying the network, he says.
"Certainly we agree that frame and Gigabit Ethernet are going to
have a role, or we wouldn't have bet our money on Berkeley
Networks," he says. "How it's positioned is important. We're not
selling religion here. We're painted as an ATM company, but
we've been selling Ethernet for several years as an integrated
solution into ATM."
FORE customer Robin Hinson agrees. Hinson is manager,
systems and networks, for Dr Pepper/Seven Up, Inc., in Plano,
Texas. Hinson designed and installed an ATM backbone on the
campus early last year. "Building a global IT data center, I did
not want to be forklifting stuff," he says. He wanted a scalable
infrastructure that would serve the company for the next three to
four years.
Hinson has more than 1,100 users in the data center and external
to the building, and he was able to upgrade the data center ahead
of the users. "For a period of time I had two different buildings
online that were about 25 miles apart with an ATM connection: I
was able to move the data center over six months ahead of the
user community." When he had to make the decision about the
system architecture, Gigabit Ethernet did not have a lot of
standards, and ATM did. What appealed to him about ATM was
the variety of applications the network handles and its scalability.
"Applications are by far the terrific test," he says. Dr Pepper runs
SAPR3, Lotus Notes, Oracle, Novell, and Microsoft NT, and is
ready for video and voice. ATM goes to the wiring closet, and
26

27. then it's Ethernet 10/100 to the desktop. With the FORE
switches, Hinson says, "Each user has a dedicated PIN 100 port.
Where it's cost-effective is that in the user community there are a
lot of moves, adds, changes. I'm ready for it. I get immediate
return on investment and future return because I don't have to
retrofit." The new network even gives him some time to plan.He
would not have, he says, made a different decision.Gill says a
flexible and scalable network takes a sizable load off managers
like Hinson. "There's a big frustration amongst the network
managers in terms of the moves, adds, and changes, as well as
complexity and costs associated with legacy networks," he says.
"The ability to have some freedom outside of the office where
you're not being beeped and chased down and telephoned 24
hours a day because the network is is not reliable is a huge issue.
What we try to do is give those IT managers the opportunity to
focus on other things that give the organization much more bang
for the buck." Gill is looking for more happy customers, he says.
In fact, FORE is focusing more on management and integration
with applications, coining the term "Intelligent Infrastructure" to
describe the combination of hardware and software. "The
Intelligent Infrastructure is focused on the complexity issues,
ease of use, and cost of ownership," Gill says. "It's a way to
simplify the network and allow the software, which is the
intelligence, to make many of the decisions and take some of the
complexity out. Therefore, it's somewhat self-healing, self-
tuning, self-configuring, and very resilient. "Rather than stay in
the enterprise backbone, however, Gill is steering FORE towards
new markets--the midsized business market on one side and the
carrier market on the other. "Many of the large enterprise
customers that we do business with today function like service
providers," Gill says. "A large utility company with lots of rights
of way or a large petroleum company that has high bandwidth
needs but also has communications needs throughout many
remote field operations, need carrier-class connections."
"ATM and IP should be integrated together as part of a managed
service, and given the prevalence of IP infrastructure, ATM for
many of the service providers represents the best transport
mechanism for IP," Gill says. He thinks that is especially true of
27

28. the ISP that wants to move from data to voice and video. "They
can deploy an ATM backbone infrastructure to transport IP, but
also to enable, down the road, the services they desire to offer.
They're not going to be able to do that with a routed
infrastructure." And the carriers have the same problems as do
enterprises: legacy infrastructures with multiple services.
"They're not all ATM oriented, but ATM represents a terrific
way to enable many of the services that they want to offer.
What's happening is many of the carriers are actually enjoying
business from enterprises, where the enterprise outsources its
wide area network to the carrier," he says. "We're one of the only
companies--Cisco is one of the few others--to sell to the carriers
and the enterprise customers, and we bring carriers enterprise
business as a channel for them."
Date: Jul 13, 2007
Guidelines for issue of ATM-cum-Debit Cards by UCBs
RBI/2007-2008/95
UBD (PCB) Cir No. 6 /09.18.300/2007-08
The Chief Executive Officers of
All Primary (Urban) Co-operative Banks
Dear Sir/Madam,
Guidelines for issue of ATM-cum-Debit Cards by UCBs.
28

29. Please refer to our circular
UBD (PCB).BPD.Cir.No.50/09.69.000/05-06 dated April 28, 2006
permitting the banks fulfilling certain eligibility norms to install
ATMs and issue ATM-cum-debit cards.
1. It has been now been decided to issue guidelines for issuance of
ATM-cum-Debit Cards. Banks which are authorized to install on-
site /off-site ATMs, as per the policy in force, may introduce ATM-
cum-Debit cards with the approval of their Board keeping in view
the guidelines as given in Annex I. Issuance of offline debit card
is however, not permitted. The details of the ATM-cum-debit
cards introduced may be advised to the Regional Office concerned
of the Reserve Bank of India together with a copy each of the
agenda note put up to their Board and the resolution passed thereon.
2. UCBs should not issue ATM-cum- debit cards in tie-up with
other non-bank entities.
3. UCBs may review operations of these cards and put up review
notes to their Boards at half-yearly intervals, at the end of March
and September, every year. A report on the operations of these
cards issued by banks should be forwarded to the Reserve Bank of
India , Department of Payment and Settlement Systems (DPSS)
with a copy to the Regional office concerned of Reserve Bank of
India on a half yearly basis, say at the end of March and September
every year, incorporating information as indicated in Annex II
(N.S.Vishwanathan)
Chief General Manager-in-Charge
29

30. ANNEX I
Guidelines for Issuance of ATM-cum- Debit Cards by UCBs-
1. Coverage
The guidelines apply to the cards encompassing all or any of the
following operations:
Electronic payment involving the use of card, in particular at point
of sale and such other places where a terminal / device for the use /
access of the card is placed.
The withdrawing of bank notes, depositing of bank notes and
cheques and connected operations in electronic devices such as cash
dispensing machines and ATMs.
2. Cash Withdrawals
No cash transaction, that is, cash withdrawals or deposits should be
offered at the Point of Sale, with the ATM-cum-debit cards under
any facility, without prior authorization of RBI under Section 23 of
30

31. the Banking Regulation Act, 1949.
3. Eligibility of Customers
The banks can issue ATM-cum-debit cards to select customers as
per their own eligibility criteria subject to compliance with 'Know
Your Customer' guidelines. Banks can extend the ATM-cum- debit
card facility to those having saving bank account / current account /
fixed deposit accounts with built-in liquidity features maintained by
individuals, corporate bodies and firms. Debit card facility should
not be extended to cash credit / loan account holders.
4. Security and other aspects
(a) The bank shall ensure full security of the card.
(b) No bank shall despatch a card to a customer unsolicited, except
in the case where the card is a replacement for a card already held
by the customer.
(c) Banks shall keep for a sufficient period of time, internal records
to enable operations to be traced and errors to be rectified (taking
into account the law of limitation for the time barred cases).
(d) The cardholder shall be provided with a written record of the
transaction after he has completed it, either immediately in the form
of receipt or within a reasonable period of time in another form
such as the customary bank statement.
(e) The cardholder shall bear the loss sustained up to the time of
notification to the bank of any loss, theft or copying of the card but
only upon a certain limit or fixed amount or a percentage of the
transaction agreed upon in advance between the card holder and the
bank, except where the card holder acted fraudulently, knowingly or
with extreme negligence.
31

32. (f) Each bank shall provide means whereby its customers may at
any time of the day or night notify the loss, theft or copying of their
payment devices.
(g) On receipt of notification of the loss, theft or copying of the
card, the bank shall take all action open to it to stop any further use
of the card.
5. Terms and Conditions for issue
The relationship between the bank and the card holder shall be
contractual. As such:
a) Each bank shall make available to the cardholders in writing, a
set of contractual terms and conditions governing the issue and use
of such a card. These terms shall maintain a fair balance between
the interests of the parties concerned.
b) The terms and conditions shall be expressed clearly.
c) The terms shall specify the basis of any charges, but not
necessarily the amount of charges at any point of time.
d) The terms may be altered by the bank, but sufficient notice of the
change shall be given to the cardholder to enable him to withdraw if
he so chooses. A period shall be specified after which time the
cardholder would be deemed to have accepted the terms if he had
not withdrawn during the specified period.
e) (i) The terms shall put the cardholder under an obligation to take
all appropriate steps to keep safe the card and the means (such as
PIN or code) which enable it to be used.
(ii) The terms shall put the cardholder under an obligation not to
record the PIN or code, in any form that would be intelligible or
otherwise accessible to any third party if access is gained to such a
record, either honestly or dishonestly.
32

33. (iii) The terms shall put the cardholder under an obligation to notify
the bank immediately after becoming aware: of the loss or theft or
copying of the card or the means which enable it to be used; of the
recording on the cardholder's account of any unauthorised
transaction; of any error or other irregularity in the maintaining of
that account by the bank.
(iv) The terms shall specify a contact point to which such
notification can be made and that such notification can be made at
any time of the day or night.
(v) The terms shall put the cardholder under an obligation not to
countermand an order, which he has given by means of his card.
g) The terms shall specify that the bank shall exercise care when
issuing PINs or codes and shall be under an obligation not to
disclose the cardholder's PIN or code, except to the cardholders.
h) The terms shall specify that the bank shall be responsible for
direct losses incurred by a cardholder due to a system malfunction
directly within the bank's control. However, the bank shall not be
held liable for any loss caused by a technical breakdown of the
payment system if the breakdown of the system was recognizable
for the cardholder by a message on the display of the device or
otherwise known. The responsibility of the bank for the non-
execution or defective execution of the transaction is limited to the
principal sum and the loss of interest subject to the provisions of the
law governing the terms
33

34. ANNEX II
Reporting Format for the Issue and Operations of ATM-Cum-Debit
Cards-
1. Name of the Bank-
2. Period of Reporting-
3. Type of the card with hardware components-(IC Chip) eg.,
Magnetic strip, CPU, Memory-
4. Type of the software used-
5. Security standards followed-
6. Service provider (Self or otherwise)-
7. Total number of outlets where the ATM-cum-debit card can be
34

35. used of which-
(a) POS Terminal- (b) Merchant Establishment-
(c) ATMs-(d) Others please specify.
8. Total number of cards issued-of which-
(a) Against Currant account-(b) against Savings account-
(c) against Float Account-
9. Total Number of Transactions during the period-
10. Amount involved in the Total Number of Transactions-
11. Instances of frauds, if any, during the period.
(a) No. Of frauds-(b) Amount Involved-(c) Amount of loss to the
bank- d) Amount of loss to the card holder-
Benefits of Biometric supported ATMs
Provides strong authentication
Can be used instead of a PIN
Hidden costs of ATM card management like card
personalisation, delivery, management, re-issuance,
PIN generation, help-desk, and re-issuance can be
avoided
Ideal for Indian rural masses
It is accurate
Flexible account access allows clients to access their
accounts at their convenience
Low operational cost of the ATMs will ultimately
reduce TCO
How it works
35

36. With ATMs supported by biometric solutions, banks having a
presence across the country are leveraging on this technology.
The ATMs are networked and connected to a centralised
computer (Switch), which controls the ATMs. The use of
biometrics identification is possible at an ATM. The information
can be stored at a bank branch. ATMs are so prevalent and you
have so many people using ATMs that it becomes easy to use
biometrics as a replacement for an ATM PIN. The typical ATM
has two input devices (a card reader and keypad) and four output
devices (display screen, cash dispenser, receipt printer, and
speaker). Invisible to the client is a communications mechanism
that links the ATM directly to an ATM host network. The ATM
functions much like a PC, it comes with an operating system
(usually OS/2) and application software for the user interface and
communications.
While most ATMs use magnetic strip cards and personal
identification numbers (PINs) to identify account holders, other
systems may use smart cards with fingerprint validation. The
ATM forwards information read from the client’s card and the
client’s request to a host processor, which routes the request to
the concerned financial institution. If the cardholder is requesting
cash, the host processor signals for electronic funds transfer
(EFT) from the customer’s bank account to the host processor’s
account. Once the funds have been transferred, the ATM
receives an approval code authorising it to dispense cash. This
communication, verification, and authorisation can be delivered
in several ways. Leased line, dial-up or wireless data links may
be used to connect to a host system, depending on the cost and
reliability of the infrastructure. The host systems can reside at a
client’s institution or be part of an EFT network. The EFT
network supports the fingerprint authentication. Point-of-sale
services that use biometric solutions are also possible.
Shekar says, “The FSS Biometric ATM Solution consists of a
central server which holds a repository of customer fingerprints.
It also customizes the Switch to enable authorization of a
customer’s biometric data and interfaces with ATMs enabled
with biometric devices as per FSS specifications. The central
server solution is platform independent, it uses Java and can run
36

37. on Unix and Oracle/ Microsoft SQL Server; customisation to
BASE24 Switch (of which FSS is the distributor) is done using
TAL. Biometric application and devices from Secugen are used
for customer interface and application development.”
Axis Technology on the other hand, has developed an innovative
new product called the Biometric Retrofit Kit for ATMs. This kit
converts a regular ATM to one that authenticates users based on
biometrics—fingerprint or iris. This is an affordably priced kit tat
has generated interest among financial institutions.
Recent Initiatives
Deploying ATMs for rural masses depends largely on banks
stepping forward to take the requisite initiatives. The recent
directive from the government on financial inclusion (“banking
for the common man”) is a key driver for the growth of such
solutions in India. Banks are quite aware of the untapped
potential in the rural sector. The telecom industry is witnessing a
blistering growth pace, and so is the Internet. The National Rural
Employment Guarantee Program that guarantees employment
and payment in the rural sector requires robust solutions. Using
thumbprint and voice guidance in ATMs reduces literacy
requirements to a considerable extent. However, the technology
is not restricted to rural masses. FSS is in discussions with
Andhra Bank for deploying the BAIS. Several other public sector
and private sector banks have shown interest too. Says Shekar,
“FSS would like to work with ATM and POS vendors to provide
innovative and cost effective solutions to banks and customers.”
FSS is striving to modularise and ‘ruggedise’ the solution to
perform online functions across a wide variety of delivery
channels and payment systems. Apart from these banks, some
other banks such as ICICI Bank are planning to introduce
biometric authenticated ATMs in rural India.
CMC has been working with Institute for Development and
Research in Banking Technology (IDRBT) on a pilot project in
rural banking. Biometric (Fingerprints) smart cards, which
consist of fingerprint data and financial data, will be issued to the
rural banking customers for carrying out financial transactions.
Elaborates Mehtre, “For building and developing various
applications, CMC has a biometric technology group at its
37

38. Research and Development Center in Hyderabad. The team
evaluates the latest technologies emerging in the biometrics area.
This helps CMC’s solutions to be competitive and cost effective.
CMC has been working with Bank of India for introducing
biometric ATMs. CMC has demonstrated its Biometrics ATM
solution on the eve of inauguration of mobile ATMs for the
bank.”
ATM Growth set to explode in India
10 years ago, an ATM was a novelty in Indian bank branches.
But with the entry of aggressive private sector banks, ATMs
have mushroomed in the urban Indian landscape. Srikanth RP
and Rajneesh De analyse the ATM explosion in India and say
that newer uses for ATMs will see growth shoot up even further
Banking in India has come a long way thanks to a combination
of factors like increasing consumer awareness, technological
advancement, as well as the growing financial muscle of our
populace. Even the acclaimed Rip Van Winkles of the Indian
financial industry the PSU banks are moving up another gear in
embracing technological innovation. One such innovation is the
Automated Teller Machine (ATM), today’s most preferred mode
38

39. of delivery channel in all FIs. Banks like ICICI Bank, UTI Bank
and HDFC Bank all deploy ATMs aggressively and have seen
their customer base swell. Subsequently, even PSU banks have
followed suit with an increasing number of ATMs.
Global perspective
But how does India stand against the rest of the world in ATM
installations? World ATM installations are set to rise by 45
percent over the next few years till 2004, according to a new
report by Retail Banking Research. Currently there are over
800,000 machines operating worldwide and this figure will rise
to over 1,150,000 by 2004. Of the global figure, the largest
market was Asia-Pacific, which accounted for 253,000
installations, nearly a 32 percent global share. Of these machines,
the majorities—142,500—were in Japan. North America has
become the second largest region with 221,000 machines.
Western Europe has fallen to third position with 219,000 ATMs.
Both regions each hold over 27 percent of the world total. During
the past two years Latin America has significantly increased its
share in the world market and now has 82,500 installations, over
10 percent of the global total. Their are a further 14,500
machines in the Middle East and Africa. Finally, the emerging
markets of Eastern Europe account for 11,500 terminals.
Looking forward, the USA will still lead the rankings in ATM
installations in 2004. However China seems likely to rise into
fourth position by 2004. In terms of growth in installations the
picture is very different. India, Bulgaria, Egypt and Bolivia will
show dramatic increases in their installed base. However
developments in recent years in some countries, such as Russia
and Indonesia, mean that future growth is well below what was
forecast earlier in the decade.
PSU banks-In the driver’s seat
Market analysts believe that the growth in the installed base of
ATMs, which was primarily driven by private sector banks, will
39

40. be driven by Indian PSU banks in the next year. The number of
ATMs is predicted to reach 30,000 units within seven years,
from the current installed base of around 4,500. The retail-
banking scene is getting hotter by the day with banks going all
out to increase access points. This is great news for ATM
Majors like NCR India and HMA Diebold, which are fighting
aggressively to increase market shares. At stake is a pie of Rs
250-270 crore, which is expected to grow exponentially at a
growth rate of over 100 percent. Ironically, the introduction of
ATMs in India was not warmly welcomed by the various labour
unions. But now, you can witness ATMs everywhere—right
from Gobichettipalayam, a southern most town of Tamil Nadu to
Hazaribagh in Jharkhand.
Says Srinivas Rao, business head with the Self-Service Solution
at NCR India, “With PSU banks going all out to tap the retail
market through ATMs, the market is ready to explode. We are
extremely bullish on the Indian market and are witnessing
growth rates of over 100 percent.” Agrees Harish Murthi,
managing director, Diebold HMA; “There has been tremendous
growth in the last few years. In the years 2000 and 2001, the
market has grown by a whopping 100 percent over the previous
year. We expect it to grow at a rate of 80 percent annually in the
next couple of years.”
That India is a boom country for ATMs is corroborated by a
report from the ‘Global ATM Directory’ 2000 edition which
states that the Indian market for ATMs is expected to grow at an
estimated growth rate of 486 percent, while China’s growth has
been pegged at just over 200 percent.
Rao cites the case of China where the installed ATM base
currently stands at 26,000, up from 1,600 eight years ago. ATM
vendors are comparing India as the next China, and are expecting
similar growth in India. Explains Rao, “Every technology takes
time to get accepted. It is no different with ATMs. For example,
in China during the years 1982-1993, there were only 2,000
40

41. ATMs. But during the years, 1993-2000, it boomed to over
48,000 ATMs. India too is witnessing a similar trend.”
Adds Murthi, “Unlike China, the reach of the banks is wider in
India. Even in the most remote village of India, a public sector
bank can be found. However, population-wise the reach of banks
is limited. The amount of banks catering vis-à-vis 100 people
would be lower than many developed countries. In such a
scenario, ATMs come as a boon. Hence there is a definite
possibility of India growing over China in the ATM market.”
Winning strategies
In a move to earn greater revenues, every vendor worth his salt is
trying out innovative strategies. For example, Diebold HBA
offers a total managed service called Total Implementation
Solution (TIS). This gives banks a single window for procuring
all their ATM related needs. The basket of solutions includes
ATM monitoring, software distribution for ATMs, cash
management and network management.
Many Indian banks that were hampered because of lack of
knowledge of technology are now actively talking to ATM
vendors for outsourcing their needs. For example, Bank of India
recently signed an agreement with India Switch Company, a
Diebold HMA group company, for outsourcing the setting up of
ATMs. Other banks-especially PSU and co-operative banks—are
expected to follow this trend.
Rival NCR too has concentrated its energies on offering
specialised solutions besides the usual strategy of providing and
maintaining ATMs. Explains Rao, “Our ATM models in India
range from simple cash dispensers to scalable ATMs that can be
customised according to individual client requirements. We also
offer specialised models that dispense information and non-cash
items such as tickets and coupons.”
41

42. As part of its strategy in offering innovative services, NCR is
talking to the Railways in Mumbai for deploying an ATM, which
could be used to dispense railway tickets. The focus is on letting
the customer use the ATM as a medium which can be used for
non-cash transactions like payment of bills, insurance payments,
printing of statements or accessing the Internet. Adds Rao, “The
key idea is to get the customer used to these channels and then
migrate him to different low cost channels like the Internet. For
example, a customer using a Web-enabled ATM would be more
likely to go in for, say, a service like Internet banking. Also,
from the bank’s point of view this would be more cost effective
as a transaction over the Internet would only cost the bank
approximately Rs 10-12 per transaction.”
NCR is also looking at offering solutions that can bundle the
ATM with the smart card. For example, the value of a Petrocard
(a smart card with stored value used in petrol stations) would
double if the Petrocard user has the option of topping up the pre-
paid value of the card via an ATM. This option would give the
customer better flexibility.
Adds Piyush Khaitan, VP, Venture Infotek, “The trend now is to
use the ATM as a tool to acquire new customers and retain them
by providing a range of services. Banks are slowly waking up to
the ATM’s potential as a serious marketing tool. They are also
earning sizeable revenues by using ATMs to advertise products
from other companies.” A few banks are offering utility bill
payment facilities on their machines too. Apart from that, a
variety of services ranging from railway card/season tickets and
cinema tickets to dispensing of mobile phone smart cards are
being thought of as a part of the strategy to attract customers and
earn extra revenue.
Another unique strategy from NCR is the installation of local
language ATMs that are available in almost all Indian languages.
In rural areas for example, some farmers are extremely rich but
do not have access to ATMs. How do banks reach out to such
people? The answer is in the form of intelligent ATMs. Besides,
42

43. an illiterate person would not be able to use an ATM, whichever
language it displays. The answer is an ATM that offers an audio
aid, which has clear instructions on how to withdraw cash in the
language he speaks.
Visible trends
43

44. Explains Rao, “We are seeing two
distinct trends—state-run banks are
installing ATMs to ensure that they do
not lose customers, and to cut costs,
while private and foreign-owned banks
are using it to acquire customers.” This
does not mean that the cost-factor is not
relevant to the latter. Again, of the
installed ATM base, nearly private and
foreign players account for 70 percent.
We also see that state-run entities have
more of onsite ATMs. Adds Mani
Mamallan, senior vice president, India
Switch Company; “ATMs have evolved
from only basic cash dispensing solutions
to one which can provide value added
services. The future of ATMs will be
touch-screen kiosks, payment of bills,
and smart cards bundled in with ATMs.”
Other factors like non-banks setting up ATMs, when that is
allowed, will also offer buoyancy to the market. This segment is
closed as there is a central banking regulation that prevents it
from happening. But both Murthi and Rao feel that the entry of
non-bank players, as and when it happens, will lead to an
exponential growth in ATMs.
World’s Top Ten ATM
Countries Ranked Acc-
ording to Number of
Machines, end 2000
Country Installations
USA 197,500
Japan 142,500
Brazil 46,500
Germany 45,500
South Korea 41,500
Spain 38,000
France 29,500
Italy 29,000
UK 25,000
Canada 23,500
Source: The Global
ATM Market to 2004
44

45. Local challenges
Though the market is currently dominated by Diebold HMA and
NCR, local players like Tata Infotech are also trying to get a
foothold in the Indian ATM landscape. Says Zakir Hussain,
national manager for marketing at Tata Infotech, “Looking at the
huge demand for ATMs in India, our ATM initiative, which
started off as an export commitment, has now been expanded to
the domestic market.” Tata Infotech is one in a rare club because
unlike the others, it does not import ATMs but manufactures
them itself. Tata InfoTech too offers a full range of solutions to
the customers, which cover the gamut of cash dispensers and
ATMs. The companies own software group ensures that the
necessary software is provided to help the banks integrate their
back-end banking software.
Then there are solution providers like Venture Infotek who
provide solutions that start from ATM site preparation to the
entire backend management of the ATM business. Says Udai
World’s Top Ten ATM
Countries Ranked Acc-
ording to Percentage
Growth in Installations,
2001-2004
Country
1 India
2 Bulgaria
3 Egypt
4 Bolivia
5 China
6 Poland
7 Peru
8 Russia
9 Indonesia
10 Philippines
Source: The Global
ATM Market to 2004
45

46. Singh Pathania, president and head, financial institutional
business, Venture Infotek, “Being a transaction processing
company we are looking at the networking and running of the
ATM business rather then the sales of ATM units.” He is also
planning to tie up with strategic ATM manufacturers to
specifically target co-operative banks who he feels will be one of
the major upcoming players in this segment. These banks do not
have the financial muscle of the other MNC or private banks and
very few of them can afford to invest in technology. “We would
also be focusing on interconnecting these banks’ ATMs. This
will help co-operative banks to offer their customers the facility
of transacting on any ATM on Venture’s network,” he adds.
Venture Infotek recently implemented a turnkey ATM solution
project for BNP Paribas, wherein their entire ATM services was
outsourced by the bank to the company.
Success stories
ICICI Bank is one bank, which has seen a massive surge in
volumes, since the introduction of ATMs. The number of ATMs,
which numbered around 90 in December 1999, has now swelled
to 540. Currently, the total volume of ATM transactions is
pegged at an astronomical 2,00,000 transactions a day. Says P K
Vohra, joint president, ICICI InfoTech Services, “The larger the
volume of transactions, the less the cost per transaction.” Also,
the convenience of anytime money has attracted a lot of
customers, and the bank has seen its customer base swell three-
fold from 6.5 lakh in March 2000 to 20 lakh in March 2001.
ICICI has also shown how technology can translate into reduced
costs. Typically, a transaction through a bank branch costs
approximately Rs 45. The same transaction done telephonically
costs Rs 30, through an ATM costs about Rs 18, and through the
Internet in huge volumes, only Rs 4. Just a look at the volumes
of transactions done at the ICICI ATMs indicates the high level
of success the project has seen.
46

47. Existing bottlenecks
But in spite of all the positive signals, there are problems galore,
which if not set right, can come in the way of ATM growth rates
in India. One is the familiar infrastructure problem. Other
problems are issues like obtaining many different permissions
from different authorities like the municipal authorities, building
society permission, permission for locating VSATs on top of a
building, obtaining permission from the local telecom provider,
etc. The rapid deployment of ATMs earlier was because of the
fact that there was no permission required from the Reserve
Bank of India. But today this is mandatory. Industry experts
point out that this was done because there were a lot of banks,
which set up ATMs without adequate funds. The RBI wanted to
check the status of banks before allowing them to set up ATMs.
Most banks today are looking at ATMs not only as a delivery
channel that bring in customers in droves but also significantly
reduce transaction costs. But, whatever forms the ATM assumes
in future, one thing cannot be ignored by any bank—the fact that
ATMs have come to stay.
47

48. Quick Facts about ATMs
• There are over 1.2 million ATMs installed worldwide.
• Approximately every 5 minutes a new ATM is installed.
• Various industry bodies help to self-regulate the ATM
industry including: banking associations, electronic funds
transfer associations, network associations and the
internationally active ATM Industry Association
(ATMIA).
• The ATM is one of the most important technological
inventions of the second half of the twentieth century,
helping to create the 24 X 7 open convenience demanded
by the consumer society.
• The ATM provides millions of cardholders around the
world with convenient 24 X 7 all hours’ access to their
own banked cash near to where they live, work and shop.
• ATMs have made banking more convenient today than
ever before: with the touch of a few buttons, cardholders
can withdraw cash, make deposits, top up air time, pay
bills and transfer funds.
The industry does care about the security of cardholders and has
formed a Global ATM Security Alliance to combine global
security resources to stamp out crime and fraud connected to
ATMs.
48

49. Copy a card’s security information on its magnetic stripe in
order to reproduce the information on a counterfeit card.
Card swapping – where a customer’s card is swapped for another
card without their knowledge during an ATM transaction.
Shoulder surfing – where an individual stands close by to
observe PIN entry.
Compromise of PIN number – either the customer’s PIN is noted
by observation – “shoulder surfing” or through binoculars – or a
hidden camera illegally records the PIN.
Vandalism – where an ATM machine is deliberately damaged
and/or the card reader is jammed preventing the customer’s card
from being inserted.
Physical attacks – where an ATM machine is physically attacked
with the intention of removing the cash.
Diversions – when criminals use messages and signs affixed to
ATMs either to make the modifications they have made to the
ATM look less suspicious or to direct customers to a nearby
ATM, which they have compromised.
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50. ANALYSIS THE SURVEY
Analysis for the better understanding of the HSBC bank
account holders was carried out. The purpose of analyzing was to
know customer satisfaction, awareness of the ATM offered by
the bank and that, their view about some facilities they would
like to have and improvements suggested for better working of
the bank and higher satisfaction.
Questionnaire method was used to carry out the survey.
The survey was carried out in the different part of city of
Mumbai. Different type of account holders like saving account &
current account, fixed account holder were interviewed. Some
very interesting facts came up which will be dealt in detail later.
A set of 10 questions was used in the questionnaire. Which
varied from objective type to descriptive types of questions.
Questionnaire was framed and design in such a manner that it
could be filled up within 5 minutes by the person thus saving
time of interviewee.
The sample size of the survey was taken to be 50. of this
50 people 20 questioned were to business person, 15 people were
servicemen and professional, 10 students and 5 housewives or
50

51. other categories. Questions ranged from getting information
about ATM using, depositing money in ATM etc.
Besides the questionnaire, method information was also
gather by means of secondary data from sources such as:
1. Branches of HSBC
2. HSBC websites.
SHRI CHINAI COLLEGE OF COMMERCE &ECONOMICS
Survey for Project on Automated Teller Machine (ATM)
NAME:
______________________________________________
DESIGNATION:
_______________________________________
SIGNATURE:________________________________________
__
CONTACT
NO:_________________________________________
1. Do you have ATM card?
Yes Or No
2. How do you find depositing money in ATM?
Complex OR Simple
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52. 3.Do you find using ATM card Risky?
Yes Or No
4.comparing the bank how do you like service of ATM?
Good Better Best
5. Which bank you prefer for ATM cars?
Private bank Nationalize bank
Suggestion: ________________________________________
________________________________________
Project Guide: Prof.Nishikant Jha
Survey conducted
by:
Signature:__________ Priya R Gadoya
TY.B.B.I. Roll no-
16
1. Do You have ATM card?
Yes 60%
No 40%
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53. 2. How do you find depositing money in ATM?
Simple 75%
Complex 25%
3. Do you find using ATM card risky?
Yes 50%
No 50%
4. Comparing the bank how do you like service of ATM?
Good 10%
Better 75%
Best 15%
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54. 5. Which bank you prefer for ATM card?
Private 75%
Nationalize 25%
Questionery for Banker
1.How Many ATM Centres in our country & out side Country
54
User of ATM card
Good
Better
Best

55. Ans. Over 15000 Centres Approx. One Million out side Country
2. How much Bank charges your are charged to Provide ATM
Facility?
Ans. Rs. 150/- p.a
3.On and average How much cash do you put in to ATM?
Ans. 2 Lacs to 2.50 Lacs per Week.
4.Custmors complaintss about ATM Card?
Ans. Not accepting ATM card in Some Machines.
5. How do you handle ATM Problem?
Ans. Depends upon your problem. Eg. If ATM Card is Lost, and
Custmore Lodge the Complain no more operations are allowed
in that ATM card with Immediate effect.
6. Latest Technology Provided by Bank?
Ans. Internet Banking.
7. As per your View What are the Advantages & Disadvantages
of
ATM ?
Ans.Advantage :- 24 hours 7 days services provided to
customers
Disadvantage:- If you Lost ATM Card,it can be Misuse by
Some One
8. How Much bank charges are charged if we use other bank’s
ATM Machine?
Ans. Rs.55 Per transaction
55

56. 9.What are the software are used by the bank?
Ans. HSBC software development ltd has establish a software
center in pune to develop solution for HSBC’s group offices
world wide.
10. How does debit card work?
Ans. ATM is a whilest at Merchant establishment it works it
work in the same way as crdit card accept that the transacted
amount is directly debit from your saving & current deposit
account.
56

57. Conclusion
It ’s a brave new world in the ATM space — one that
offers a great deal of flexibility for financial institutions. In this
new era, FI must consider best of breed solutions. Selecting
ATM software separate from ATM hardware will give FIs more
leverage, more choices and more flexibility to add functions and
Services in the future. It also will allow them to complement
their networks with hardware from multiple vendors, thereby
helping them reduce their overall cost of ATM ownership.
ATM is time & cost saving machine. For many customers
ATM are becoming the only interaction they have with their
banks. Having a look at the no of increasing ATM it is clear that
in future there won’t be any problem of cash withdrawals.
Due to all these feature in a ATM, the customers is more
likely to prefer the ATM’s rather than bank &this may also lead
to alienation of the customer.
In addition ATM are also becoming a competitive mark
for many banks. Therefore it is imperative to ensure that the
customers experience with the ATM is safe and secure.
It ’s important to note, however, that not all ATM
deployers will progress at the same rate. Some may decide to
address their networks from a
Software-buying perspective. Others may decide that attacking
hardware. First is the best option. And some may opt for
proprietary solutions, or varying degrees of proprietary and
open-vendor solutions, over entirely open, multivendor solutions.
Regardless of the route pursued, FIs must understand that open
systems and multivendor software are the way of the future.
Whether they decide to adopt that future now or later will depend
on the size of their networks and the upfront investments they ’re
willing and able to make.
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58. Bibliography
1. Introduction to computer
Author: - Ms Alka Vaidya
2. J. A. I. I. B. Guidelines
Author:- Gyani
3. Introduction to Banking Financial Services.
Author:- Dr onkar Nath
4. www.Google.com
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