How to Set Your ATM Surcharge

There are some fees associated with operating an ATM machine. The fees cover the costs of the operation. Some fees are passed on to you, the ATM owner. Others, like an ATM surcharge, are passed on to the users.

It’s important to understand all of the fees so that you can control and maximize your revenue. But perhaps the most important fee is the ATM surcharge. That is where the bulk of your profit comes from.

We’ll tell you how it works, how much you should charge, and some strategies to keep in mind to help drive as much traffic to your ATM as possible.

What is an ATM Surcharge?

An ATM surcharge is the fee the user is charged to make a transaction on your machine. The ATM owner has complete control over this fee. You decide whether or not to charge an ATM surcharge and how much it is.

You earn the ATM surcharge by providing a convenient service to users. Users pay the ATM surcharge in exchange for the convenience of avoiding a trip to the bank. 

The surcharge is how you as an independent ATM owner makes a profit, but it’s also how you pay to operate your business. The ATM surcharge helps cover

  • The purchase of the machine
  • Parts costs
  • Maintenance
  • Signage
  • Receipt paper
  • Insurance
  • Etc.

Basically, the surcharge fee is how you make back your investment with the opportunity to profit.

On average, ATM surcharge fees are $2.50, but they can range from $0-$8. So how much are you going to charge your customers to use your ATM?

How to Set Your ATM Surcharge

There are many factors to consider when it comes to setting your ATM surcharge. Above all, you want to maximize your profit. But too high of a surcharge and you might lose traffic to lower-surcharge ATMs. 

Of course, you can adjust the surcharge fee based on activity. Try one strategy and monitor your traffic and transactions. Then make adjustments as necessary. Here are some things to consider:

Return on Investment (ROI)

Before you can profit from your ATM, you have to make back the cost of the purchase of the machine. One strategy for determining your ATM surcharge is to calculate how much you have invested and how much time you’d like to spend making it back.

Your investment might include the cost of purchasing the machine, any extra features or add-ons, signage, insurance, etc. Will you purchase an enclosure for the machine? Do you need to invest in extra security for an outdoor ATM machine? 

What about maintenance and up-keep? How much will you spend on receipt paper in a month? Do you live or work in close proximity to your ATM? If you will be refilling the machine yourself, you’ll want to reimburse yourself for the time and cost associated with travel. These are all factors to consider. 

Add up everything you spend to get your ATM up and running to determine how much you need to make back. You can expect your ATM to get about 5-6 transactions per day. That equates to 150-180 a month. Multiply that by your surcharge and calculate how quickly you can start making a profit.

You might want to start with a higher surcharge to make back your investment as soon as possible. Then you can lower the surcharge over time. But you don’t want to lose traffic, so you want to consider your customers as well when determining your ATM surcharge.


You will make more money by getting more traffic to your ATM. This might be a reason to start with a lower surcharge. It just depends on your competition. Is there another ATM close by? To introduce your new ATM to customers and entice them to use yours over others, you might offer a competitive surcharge fee.

You’ll want to consider demographics as well. Lower-income areas might require a lower ATM surcharge while wealthier communities might not blink at a higher than average ATM surcharge. You need to consider the average withdrawal amount, too. 

The average withdrawal amount is between $60 and $100. If the average withdrawal amount from your machine is on the higher end, you might consider a higher surcharge fee. And vice versa. It seems more reasonable to pay $3 to withdraw $200 than it does to withdraw $60.

There are also some locations that typically charge higher surcharge fees than others. Patrons of casinos and gentlemen’s clubs, for example, tend to spend large amounts of cash, so a $3.00+ surcharge seems small in comparison to the amount withdrawn.

If your ATM is located in a casino or gentlemen’s club, you also have the market cornered. The surcharge fee can be higher because of the added convenience. Customers of these establishments tend to stay a while and aren’t able to easily run to the gas station or parking lot just to take advantage of a smaller surcharge. 

So, it goes without saying that customers expect a small surcharge from ATMs in locations they visit during their day-to-day activities. This includes restaurants, convenience stores, gas stations, etc.

Location Owner

Depending on your site location agreement (SLA), you may or may not be splitting the surcharge fee with the location owner. Sometimes store owners will be content to have the increased business and let you have the surcharge as your share of the profit.

Convenience stores, for example, experience 23% more in sales from ATM users than from non-ATM users according to ATM Marketplace. With the opportunity to see a 20% increase in sales with the installation of an ATM machine in their stores, store owners benefit from your machine by getting more traffic and sales alone.

However, if you are in partnership with a location owner who needs more incentive to agree to share the space, you might have to negotiate a portion of the surcharge fee. This will likely result in a higher ATM surcharge so that you are still able to make a profit that makes it worth your while.

And the location owner might have his or her own input regarding how much to charge. After all, the location owner knows the customers and competition best. 

The location owner will know what amount is convenient for the customers based on the average transaction amounts made in the store. But, he or she will want to maintain a competitive surcharge fee since the bulk of his or her incentive relies on increased traffic to and sales from the store. A higher than average number of transactions could make up for the loss of a higher surcharge.

Are there any other third parties you need to split the profit with? Will you hire a vaulter to load the machine for you? Do you have any business partners? If you will be sharing the profit, you might want to set a higher surcharge to make it worth everyone’s time.

Surcharge-Free ATMs

“Surcharge avoiders” will go out of their way to use a machine that doesn’t charge them to make transactions. As you can imagine, surcharge-free ATMs drive more traffic than most. But if you aren’t making any money per transaction, what’s the point?

If you own an ATM at a location owned by someone else, you probably shouldn’t offer surcharge-free transactions exclusively. Because the surcharge is where your profit comes from.

However, if you are the store owner who wants to add an ATM to enhance your business and better serve your customers, the increase in traffic and sales in your store could bring in enough revenue for it to be worth forfeiting the surcharge fee. 

So what you have to consider at the end of the day is whether the surcharge-free ATM will attract enough new business to offset the loss of revenue required to cover the ATM overhead and surcharge profit. And this might depend on competition.

If there is another surcharge-free ATM nearby, you might not get enough new business to make that revenue loss worth it. If there isn’t another surcharge-free ATM nearby, you stand to gain a significant advantage over other ATM locations that do charge a fee.

Surcharge Fee vs. ATM Interchange

There are other fees associated with ATM operation as well. An ATM interchange fee, for example, is a fee charged by the network your ATM is connected to. 

Banks have to pay the networks (Plus, Cirrus, Star, NYCE, etc.) to route out-of-network transactions to the correct account. If you’ve ever wondered why you can usually withdraw funds from your bank’s ATM but are charged a fee at non-bank ATMs, this is why. Your card is in-network for use at your bank.

Interchange is typically how ATM processing companies and bank sponsors make money. Sometimes ATM owners are able to take part in a share of the interchange fee, but it depends on how your provider operates. You’ll want to work with them to get in on any interchange profits.

For the purpose of setting your surcharge, all you need to know is that surcharge fees and interchange fees are separate. You do not need to consider ATM interchange when determining how to set your surcharge.


The good news is that the ATM surcharge is completely up to you and your partners. The bad news is that there is a lot to consider to get it just right. Setting your ATM surcharge will require a degree of strategy. But again, you can test and adjust as necessary. See what works and what doesn’t to get the maximum profit. 

If you’d like to get an estimate on what a potential ATM location could make in profits, check out our ATM surcharge calculators. These calculators will help you determine if the surcharge you’re looking to set would satisfy your ROI.

When you work with ATM Depot, you keep 100% of your surcharge. Not all providers work the same way. So ask around and find a system that works best for you. If you have more questions, contact a representative today!

Starting Your ATM Business: ATM Business Contract and Other Documents

Do you need an ATM business contract to start your ATM business? What regulations apply to running your ATM? What do you need to do before you order your ATM machine? We’ve got the answers.

Making the decision to start an ATM business is a big step in and of itself. Completing the required paperwork can be a daunting next task. But don’t let it stop you from making money.

In this article, we cover the first steps in planning your ATM machine purchase. We want you to know what to expect so that you don’t waste any time and you avoid unnecessary stress.

As an independent ATM deployer (IAD), once you’re prepared, you can start making money with your ATM!

What is an ATM Business Contract?

An ATM business contract is a documented agreement between you—the ATM owner—and the proprietor or merchant where the ATM will be placed. This is also referred to as a contract agreement, placement agreement, or site location agreement (SLA).

Rather than retain sole ownership of the machine by renting or owning your own space, you create a partnership with the third party merchant when you use someone else’s business or space to house your ATM machine. 

So, depending on where you plan to place your ATM, you may or may not need one of these contracts or agreements. If you do plan to work with a third party, you will need more than a verbal agreement. 

An ATM business contract or SLA details the ins and outs of the ATM placement and operation. This protects you if you ever have any issues working with the third party.

Common clauses include

  • Where the ATM will be placed
  • Responsibilities of each party 
  • Length of time agreement is effective
  • Revenue split
  • Insurance
  • Maintenance

There are two ways we recommend getting one of these contracts:

First, you can work with a lawyer to draft a contract that lists the protections you need. However, as you can imagine, this is the costly route. Lawyers can cost upwards of about $1000.

Or, you can use a contract template. Again, make sure it lists all of the protections you need. You can find contract templates with an ATMDepot membership.

But, if you won’t be working with a third party, you can skip this altogether. However, choosing your ATM location is the very first step you need to take before ordering your machine. In the next section, we’ll tell you where to start.

ATM Location

Before you order your ATM machine, you need to have a location for it first. This will help you determine whether it will be indoors or outdoors, what size machine your location can support, and whether or not you need an SLA (more on SLAs below).

If you place the ATM in a business or location that you own, you don’t need a placement agreement or SLA. However, you will if you want to work with a third party merchant.

Document Checklist for Starting ATM Business

These are the forms you will need to complete and send to your ATM provider to make sure they have all of the information they need and that you are in compliance. 

You might not complete the equipment order form until everything else is finished, but deciding on equipment is an important step. It requires you to really think about your plan and your needs for your ATM, so we’ll start there.

Equipment Order Form

Once you have your location set, you can order your ATM machine. However, there are two more decisions for you to make before you can submit this form. 

First, you need to decide how much your surcharge will be. The surcharge is the fee associated with conducting a transaction (typically withdrawal transaction) on your ATM. Usually the fee is $2.50, but you want to make sure you keep up with other ATMs nearby. 

For example, a surcharge of $2.50 might not be wise if the ATM across the street only charges $2.00. Alternatively, if the ATM across the street charges $2.50, you might want to charge $2.00 to increase traffic to your machine. 

Second, you need to know what cash denominations your ATM will dispense. The standard is 20s, but you might want 10s if your ATM is located in a low-income neighborhood. This way you accommodate the needs of customers who might have lower account balances.

You will need both surcharge and denomination to complete your equipment order form. You will also need to decide if you will do the installation yourself or if you will have it professionally installed.

Finally, you’ll need to link a bank account. 


An ACH form documents your account information. You will need to provide account and routing numbers and give permission to have funds electronically transferred to your account.

When you open this account, or if you change an existing account, there are some requirements the bank has to meet to get your account set up for your ATM business.

The USA Patriot Act was passed in 2001 in order to vet bank account owners. This act applies to you as an ATM business owner because you will be under scrutiny for its anti-money laundering provision. 

Additionally, because running an ATM machine means you are conducting money wire transactions for other people, you are not allowed to operate this type of business if you have committed a felony or financial crime.

Section 326 of the USA Patriot Act requires your financial institution to obtain, verify, and record information about you and your business before setting up an account for your business. Therefore, you will need to provide them with your name, address, date of birth, and other identifying information.

The bank will need your driver’s license to identify you, and you’ll need to provide a copy with your ATM purchase documentation.  

Driver’s License

Your ATM processor will need a copy of your driver’s license for many of the same reasons as your bank. You will have to pass a basic background check to be approved for owning and operating an ATM machine. A copy of your driver’s license is the best way to verify your identity.

Voided Business Check

A voided business check verifies the legitimacy of your linked account. Your linked account must be a checking account, not a savings account. And it must be a check—with account and routing numbers—not a deposit slip.

ATM Operator Agreement and Application

Your ATM application is also known as the ATM Operator Agreement. This form tells banking partners who they are working with and makes sure all federal regulations are met.

W-9 Form

Since you will be earning revenue from your ATM machine, you will need to complete a W-9 form to report residuals for tax purposes.

ATM Processing Agreement

The ATM processing agreement lists your rights and obligations as the ATM owner as well as the rights and obligations of the ATM processor. This will be the legal contract between you and the ATM processor that runs your ATM machine program. This contract also ensures your payment as agreed upon.

Other Applicable Documents

These documents depend on your specific needs and situation. Check with your local courthouse to see if you need any special licenses or permits before operating your ATM. And remember, you only need an SLA if your ATM will be in a location that someone else owns.

Business License and Permits

While you can operate your ATM machine as a sole proprietor, LLC, or corporation, you might need to check with your local government about specific requirements. The most common route is to register as a sole proprietor under a “doing business as” business name. Then, you can open your bank account under that.

Some ATM processors will license you the rights to use their name as part of your company name. This might be an option for you as well. It will of course require additional paperwork and a fee for usage rights. However, the nominal fee is often worth the instant credibility and trust you get by associating your business with one that’s more established and well-known.

So you don’t need a specific license to operate an ATM business. When you are ready to purchase your ATM, you will simply complete the ATM Operator Agreement form which serves as the contract between you and the ATM processor. 

Placement Agreement or Site Location Agreement (SLA)

This also refers to the ATM business contract we opened this article with. It’s a good idea to have this to protect you against any potential disputes. The SLA makes your agreement legal and binding before you install the ATM machine. This is a win-win for you and the location owner.

You can work with a lawyer to create a personalized contract or agreement, or you can use one of our templates on if you are a member. You can also find scripts here for pitching and selling your idea to business owners you’d like to work with to get them on board!

ATM Insurance

Purchasing ATM insurance is not mandatory, and you can purchase it on your own timeline. It might be a good idea to get insurance once you have your machine set up and filled with cash. There are coverage options for equipment and cash or one or the other.

When searching for insurance companies, look for ones that are associated with the ATM Industry Association (ATMIA). That way they can better guide you toward a policy that meets your specific needs.

Keep in mind also that if your ATM location is owned by someone else, that party might have insurance requirements for you to follow. And you might opt out of insurance altogether if your ATM location is open 24 hours or if it’s under constant security. 

Wireless Agreement

Completing this agreement allows the ATM processor to send you an ATM wireless modem that converts your signal from Internet to cellular. This provides a faster connection speed.


There are a number of steps necessary to get started with your ATM business. However, they are all relatively simple. Use this article as a checklist to prepare and make the process as seamless as possible.

Getting the ATM business contract, or SLA, and setting up your account with your bank are the two steps that will take the most time. That’s only because you have to coordinate with those other parties. Everything else is up to you to fill out and submit. Check out our article on choosing the right ATM equipment here. You can even speak with a representative if you still have questions. ATM Depot has everything you need to start your ATM business today!