How Much Does it Cost to Start an ATM Business?

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Before jumping head first into the ATM business, you might wonder how much does it cost to start an ATM business. This is a fair question. You might already have a budget for startup costs, and an ATM business model would need to fit into that budget. 

Or, maybe you want to know how much you need to budget for. Based on the number, you might then want to compare different business opportunities or strategies. You also might need to save up some money before you start your ATM business.

While we can’t give you a definitive number, we can tell you what expenses to account for. You will need to do some research and make some decisions only you can make. Not every ATM business looks the same. Your ATM business model depends on your unique lifestyle and goals.

So you’ll need to decide which machine to purchase, what features you need, where to place the machine, and how many partners you’ll have. All of these will vary in cost, but we’ll guide you in the direction of where to begin your research to find out how much does it cost to start an ATM business. 

Purchasing Equipment

The main cost of starting an ATM business is purchasing the machine itself. However, the cost doesn’t stop there. Depending on which machine you purchase, you might have to get an upgrade kit or pay for additional features. 

ATM Machine

ATM machines can range in cost from $1,000 to $8,000. This is a wide range, but it depends on the size of the machine and the age. 

Realistically, however, you should probably expect to pay around $2,000-$3,000. That is the range for the most common, free standing ATM machines.

Wall mount ATM machines are smaller and will cost less than a through-the-wall ATM machine designed to service areas with a lot of foot traffic and a lot of business. And a refurbished machine will cost less than a brand new machine. At least as far as the unit is concerned.

Upgrade Kit

What you have to look out for with refurbished machines is compliance. As regulations change, so must ATM design. Fortunately, to help accommodate these changes, upgrade kits are often available to keep a machine compliant without having to scrap it completely!

However, in some cases, a machine is just too old that it won’t support an upgrade kit. And if this is the machine you purchase, you will probably end up losing money. 

You also don’t want to purchase a machine that isn’t certified refurbished. If you do, you run the risk of spending more money on repairs than you would have if you had just purchased a new machine!

So keep these three things in mind when shopping for a refurbished machine:

  1. Will it need repairs?
  2. Will it need an upgrade kit?
  3. Am I saving money or creating more expenses?

On the other hand, you could find a nearly new, certified refurbished ATM machine that still has close to 8 years left of life or more. 

Choosing equipment is the biggest, most important decision of your ATM business. Because it is your ATM business.

Extra Features

There are a number of features you can add to your machine to help draw in more business. These features are not necessary for your machine to function or be compliant, they just help you keep up with your competition.

Lighted keypads draw customers in at night. Signs can be added to the top of your machine to help catch the eye of passers-by. And cameras can add another layer of security to your business.

As you can see, you’ll have to weigh the pros and cons of your ATM equipment purchase. Do you want to spend a little bit more for a brand new ATM machine that comes fully loaded or is it a bargain to purchase a used or refurbished machine that might need upgrades or supplemental features to draw customers? 

Insurance

You don’t have to purchase ATM insurance. This is completely up to you. ATM insurance works just like any other insurance policy: you pay a regular price so that you are covered in the instance of vandalism, theft, weather damage, lawsuit, etc. Typically you can choose a policy that covers the equipment and cash or one or the other. This gives you a few more options and flexibility. 

And you don’t have to purchase it right away. If you want to wait until you start making money from your machine, you can pay for the insurance later from the ATM revenue. 

You will want to work with an ATM company that is associated with the ATM Industry Association (ATMIA). These companies can guide you toward a policy that meets your specific needs so that you don’t pay for more than you need or avoid not having full coverage.

To give you an idea of what to expect if you do want to purchase ATM insurance, the average ATM business in the United States spends about  $400-$700 per year for $1 million in general liability coverage. Factors that contribute to the price of your policy are location, deductible, and number of employees.

However, if the business where your ATM is located has insurance for the property or business, your machine might be covered under the existing policy. Other location owners might require you to carry general liability insurance in order to work with you. Therefore, you open yourself up to more opportunities if you have coverage. So check with the location owner to see if there are insurance requirements you need to follow. 

Leasing a Space

You might find a business or store owner who is willing to rent the space where you want to place your ATM. This amount will depend on the location itself. And whether or not you agree to the rent price will depend on your projected revenue. Will you still be able to make a fair profit after deducting the cost of rent?

To make sure you always make enough to cover the rent, you might suggest splitting the revenue instead of a set rent price. That way, even when business is slow, you are still guaranteed a profit.

Revenue Split

If you don’t have your own business or store, you might have to convince a store owner to allow you to place your ATM in his or her business. While it doesn’t cost anything to reach out to and make connections with local business owners and decision makers, you might have to negotiate a revenue split to get them to agree to your proposition. 

This isn’t necessarily a start-up cost, but you’ll have to consider it when calculating the rate of your return on investment (ROI). It’s also a good alternative to paying rent for the space.

How Much Does it Cost to Start an ATM Business?

While we can’t give you an exact number, we can let you know how to figure the number before you purchase your machine. It’s a good idea to do some preliminary research on the cost of equipment, features, insurance, location, etc. 

That way you know whether this business is right for your goals and you know what to expect when it comes to your ROI. As you can tell, though, that when it comes to start-up costs, the ATM machine business has a much smaller overhead than many others. 

In the very simplest terms, you purchase a machine, set it up for use, and start making money. What makes it so simple is that you can find a business that already has a store and already has customers. And you get paid to make it better!

If you have any questions, you can contact us to speak to a representative. Then, contact us when you are ready to start your ATM business!

5 Common ATM Error Codes and How to Fix Them

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ATM error codes can help you keep your ATM working properly. No one likes to see an “Out of Order” sign. Customers expect ATMs to be available and functioning when they need cash. And that’s your service—convenient access to their accounts.

So it hurts your business as well when your ATM isn’t functioning. You lose out on transactions, so it’s important to get your machine back up and running as quickly as possible.

It isn’t very common for new ATM machines to malfunction, but anything can happen at any time. So no matter the age of your machine, it’s a good idea to conduct regular servicing and maintenance to keep your machine running for as long as possible with as little downtime as possible.

There are 5 common ATM error codes that you are bound to see throughout the course of your ATM ownership. But they are easy fixes that you can handle yourself. It’s also fairly simple to conduct other troubleshooting if you follow the right steps. Follow this guide as well as the appropriate owner manuals to help.

How to Troubleshoot Your ATM

There are a few simple steps you can take to troubleshoot your ATM if you encounter issues. The first step is to assess the situation. This involves you recognizing that your ATM machine isn’t functioning properly. The first thing you should look for are error codes.

The second step is to identify the problem. You might obviously know what part or function of your ATM machine isn’t working. If not, an error code can help. An error code may or may not identify the problem specifically. If it doesn’t, it should at least guide you in the right direction.

Next, you need to resolve the issue. Consult outside resources such as your ATM manual or an ATM technician to determine the severity of the issue. There are two categories of ATM troubleshooting: first line maintenance (FLM) and second line maintenance (SLM). 

FLM can be performed by the ATM owner or cash loader. Most ATM troubleshooting can be done by the ATM owner by following simple directions associated with the error codes and referencing instructions or using the proper ATM owner manuals. 

Simple issues like paper jams, cash jams, and empty receipt paper you can fix yourself. SLM will need to be performed by a qualified technician. 

Hopefully your problem requires only FLM. Fixing the problem yourself is quicker and cheaper than calling a technician.

But, if the machine needs to be opened up for servicing, you might need SLM. It’s best to call an expert when tools and specialized knowledge are required.

Finally, make sure you document everything. Take note of what went wrong, what action you took, and what the result was. You might need this information later for warranties, equipment audits, or to advise employees when future troubleshooting is necessary.  

5 Common ATM Error Codes and How to Fix Them

The purpose of ATM error codes is to diagnose a problem with your machine. They should guide you to the proper repair strategy. There are dozens of ATM error codes you could come across during your time as an ATM business owner, and they vary by machine.

However, we’ve identified the 5 most common ATM error codes and explained how you can quickly fix them:

1. 40047 – Dispenser Error

This means that there is a cassette misfeed and the dispenser isn’t working properly. To fix the problem, check for bill jam. If no bills are jammed, clean the dispenser sensors. If the problem persists, you may need to exchange the cassette box.

2. 20013 – No Receipt Paper

If you receive this error, one of two things could have happened. One, the receipt paper is empty. Or two, there is a printer jam or some obstruction. If you are still having trouble, try the paper reset switch. The printer may require service if it still isn’t working and your troubleshooting has been unsuccessful.

3. D1500 – Connection Error

This means there’s a modem disconnection or timeout. If the host doesn’t respond in 60 seconds it can result in this error. To fix it, verify the host phone number and modem speed. If they’re consistent, your modem could be defective and you’ll need to contact the telephone company.

There’s also a chance that the modem cannot support the connection or there is excessive line noise (D170x). This happens when the phone line connected to the ATM will not support data-communication. You might be able to fix this with an in-line filter.

Another cause could be excessive EMI transmissions from an outside source such as a neon sign or freezer. Or, it could be a programming issue. Check all programming, especially the Dual Master Key setting and Host Processor Mode.

4. F000F – Incorrect/Empty TID

If the terminal ID (TID) is not set, you will need to do so. This error code is triggered when the TID is not set or is set incorrectly. You can check this in the Host Setup.

5. 20002 – Low Cash or No Cash

You will get this error when the low cash warning sensor on the dispenser is open. If “Low Cash Warning” is enabled in the Transaction Setup menu, this sensor will open when the cassette reaches (+/-) 75 bills. If your machine is typically stocked with a low amount of bills, you might want to disable this function. And of course, to fix this error, feed the ATM!

ATM Troubleshooting Resources

When you work with ATMDepot, you’ll never be at a loss for resources or assistance. Here is a list of resources you can draw on if you need help addressing an issue with your ATM machine:

Error Code Lists

You might encounter an error code that’s specific to the manufacturer of your machine. You can search the list of Triton ATM error codes here and Tranax (Hantle) ATM error codes here. The list of Genmega’s error codes can be found in Appendix A of the Operator Menu Guide.

ATM Owner Manuals

Your ATM machine should come with an owner manual, but it’s possible that it’s been misplaced since you received it. If you ever need to quickly reference the owner manual for your ATM machine, we’ve got them all listed here.

Warranties

Each new ATM terminal offered on ATMDepot.com comes with at least a 12-month warranty. Some machines come with a 24-month parts warranty. And others include labor in the warranty. Refurbished ATM machines include a certified 1-year parts and labor warranty. 

So you’ll want to check for this if you encounter issues within these timeframes. You could save yourself a lot of money if your machine is under warranty. Details for each machine can be found here.

Tech Support

For quick service questions, you can call our toll-free support number 888-959-2269 or complete a form online to contact us with a service request or other inquiry. Also, by entering your terminal identification number (TID), you can access our technical support number that can assist you 24/7/365.

ATM Error Codes and Troubleshooting

The most common ATM error codes are going to be simple fixes you can take care of yourself. On the rare occasion that you’ll have to consult outside resources, you should know that they are available and easy to access. The most important thing is identifying the problem immediately and resolving the issue quickly. Because you don’t want your customers to face an “Out of Order” sign on your machine!

Choosing an ATM Location: 9 Best Locations for ATM Machines

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Based on our experience in the ATM business, we’ve developed a list of the 9 best locations for ATM machines. The list is ordered from locations that see the most transactions monthly to the locations that see less but that are still lucrative.

Let’s look at some numbers:

An ATM placed at a slow location could make a minimum of $180 a month. It would require that at least two people use it every day for a $3 surcharge. On average, you should expect your ATM to process 150-180 transactions a month. That’s 5 or 6 a day.

The point is, it’s very easy to run a successful ATM business. You just need to choose the right location. We can help.

The Importance of Choosing a Good Location

The bottom line is that your ATM machine only makes money if people use it. So think about where people need access to ATMs and what locations people frequent the most consistently.

Don’t give up right away if the locations you’re considering already have machines. A new machine is almost always preferred over an old one. Do some investigating and see if existing machines are in working order, outdated, and compliant. 

If you find a poorly maintained ATM taking up prime real estate, see if you can swoop in with a better offer. 

Choosing a “bad” location doesn’t necessarily mean your business won’t be profitable. It just means you might not be making as much as you could. It will take you longer to meet your ROI and you’ll make less revenue in the long run. 

A poor location sees, in our experience, 2 or less transactions a day. That translates into a 25-30% annual return. That’s still a profit. If, after a while, you aren’t seeing the revenue you want, you can move the ATM to another location! 

You’re looking, ideally, for an ATM location that sees 80-100 transactions a month. That equals about 40-70% ROI annually. If you find a location that earns more, great!

There’s no problem with trial and error when it comes to choosing a location. You can also consult with the ATM company or processing provider you work with. Someone who has been in the business a long time and personally operates ATMs on a daily business is the best advisor when it comes to discussing potential locations.

What Makes the Best Locations for ATM Machines?

Cash Only

Top performing ATM machines can be found where people spend large amounts of cash. Cash only establishments kind of encourage this behavior and therefore are perfect locations for ATM machines.

High Traffic

ATM machines are there for customer convenience. So you want to make sure your machine is clearly visible, easy to access, and safe to use. Locations with heavy foot traffic encourage more ATM transactions because of the number of people who see the ATM regularly. 

The more people who pass by your machine, the more opportunities there are for transactions. And high traffic areas can make customers feel safer accessing their accounts because they are surrounded by witnesses.

Good Reviews

Again, you want your machine to be where the people are. If you arrange to have your machine placed in a business that doesn’t get many consistent customers or has poor reviews, you’re missing out on revenue. Businesses that people enjoy patronizing and that get good reviews are where you want your machine. Because that’s where everyone is at!

Liquor License

Liquor stores and other locations where liquor is served are good locations for ATMs. Similar to convenience and grocery stores, liquor stores are one-stop-shops, if you will. Rather than have to make one more stop to get cash, it’s convenient to be able to do so from the place the customer is already shopping. 

ATMs in liquor stores also typically have higher surcharges. So not only is the ATM market cornered in a liquor store increasing transactions, but you make more per transaction too.

Proximity to Other Machines

The closer your ATM is to other machines, the more competition you have. Will customers use your machine or the one down or across the street? You basically have to split customers.

There are only three instances where it would be advantageous for you to place your ATM in close proximity to another:

a. You offer a lower surcharge that gives users an incentive to choose your ATM over others

b. There’s just that much foot traffic that more than one ATM is necessary to avoid lines and overcrowding

c. The ATMs nearby are old, outdated, and/or frequently out of order

Again, when it comes to choosing a location for your ATM, consider the users’ needs. The biggest selling point of your ATM should be convenience.

Close to Your Home or Work

If you want to make the most profit from your ATM business, you need to minimize costs where possible. Traveling to and from your ATM is one place to start. If you place your ATM close to places you already go, you save time and money having to access it. Make sure your ATM is convenient for you, too. Otherwise, you don’t pocket as much revenue as you should.

You’ll need to regularly access your ATM to load cash, add receipt paper, clean the machine, and address any technical errors. Customers can’t use your machine and you can’t make money if your ATM isn’t in working order.

If you have a little experience running an ATM business already, it’s okay to venture out and maybe install an ATM farther away if you find a really good location. You might even hire someone to visit and load the machine for you if your ATM does really well and you can afford to do so.

9 Best Locations for ATM Machines

The numbers provided in this section are based on ATM Depot’s experience in the ATM business. There are many factors that contribute to a location’s success, most of which we covered above. However, there are seasonal and geographic factors as well. 

Keep in mind that these numbers are averages. The best rule of thumb is to gauge a business’s popularity and success. If a business is busy, regularly draws in customers, and has a good chance of staying around for a while, your numbers are going to be higher than a location with minimal success.

In terms of revenue, the following locations have the highest profit potential. However, they are usually supplied with ATMs from the beginning, so it’s difficult to get started in these locations unless you know someone and have an in.

1. Casinos

ATMs in large casinos see around 1,500-3,000 transactions monthly. And we’ve seen casino ATMs with upwards of 3,000 transactions monthly. Small casinos see around 30-800 transactions monthly. 

Not only do these ATMs get a lot of traffic, surcharge fees are also typically quite high. High traffic plus high surcharge equals great profit.

While casino ATMs get the most transactions of any other location, they are difficult to obtain. You’ll often see bank-controlled ATMs in casinos, but that isn’t always the case. The best way to get access to this money-making location is to rely on preexisting relationships.

Is there a service you already offer a casino? Do you know someone in charge at a casino? Is there another service you could add to your ATM machine pitch that would incentivize a casino owner to partner with you?

Because casino ATMs are so necessary and lucrative, you’ll rarely find a location in want of one. You might, however, be able to negotiate a better deal than the current ATM owner. Keep in mind that all of this is easier to navigate if you already know someone in the casino business.

2. Gentlemen’s Clubs

We offer the same advice for seeking out a gentlemen’s club as a location for your ATM machine. Gentlemen’s club ATMs see around 300-800 transactions monthly but are so coveted that competition to get in is high. Unless you know the owner of a club, you’d have to be a pretty good salesperson to get the attention of someone who’s already set up with ATMs.

But again, it’s not impossible or unheard of. If you’ve been in the ATM game for a while, you might be ready to pursue these high-demand locations. If you’re new to the business, though, check out the rest of our list.

The following venues are more easily attainable. So, rather than expend all of your effort trying to get started in the hard-to-get locations, you could already be making money by aiming for an easier target.

3. Hotels

Traffic to hotel ATMs depend on hotel occupancy, of course. The more people staying at a hotel, the more potential for ATM transactions. So while small hotel ATMs see around 100-150 transactions monthly, medium hotels 100-200, and large hotels over 200, these numbers might depend on the success of the hotel itself. 

A medium, non-branded hotel with great reviews might bring in more guests and get more ATM traffic than a large, well-known hotel that people don’t enjoy staying at. 

And it depends on the geographic location, too. What hotels do people have to choose from in your area? What’s the competition look like? Where do people like to stay when they come to your town? Are hotels downtown busier? 

These are all things to keep in mind when gauging which locations have the potential for the most revenue.

4. Nightclubs and Bars

Nightclubs and bars are typically cash-heavy locations. They see around 250-500 transactions monthly. Patrons don’t want to risk losing their cards or having them stolen, so they might opt to use cash instead. Many clubs and bars require cash-only cover charges, too. 

And then there’s tipping. It’s quicker and easier to slide your favorite bartender a few bills than having it charged to the card. Cash tips are more profitable for bartenders as well since card charge fees aren’t taken out of cash tips.

5. Convenience Stores and Gas Stations

Convenience stores and gas stations should provide customers with as many goods and services as possible. That’s what makes them convenient. Customers want to stop at these locations for as much of their needs as they can because it’s quick and easy. 

C-stores and gas stations are easy to find and small enough that customers don’t have to spend a lot of time looking for what they need. ATMs at these locations are also preferred by customers because they offer a greater sense of security. There’s almost always an attendant monitoring the activity.

You can expect your ATM to get 200-400 transactions monthly in a convenience store or gas station.

6. Restaurants

Here again we have the tipping factor. Charge tips are automatically recorded and reported for taxes while cash tips can be estimated and sometimes unreported altogether making them more profitable. Therefore, servers and bartenders typically prefer cash tips.

There is also a charge to run a card. Sometimes, this charge is taken out of the servers’ tips. They leave at the end of their shifts with the tips they earned minus the fees for the number of customers who paid with a card.

Smaller restaurants might be cash-only for this reason or charge the fee to the customer’s transaction. In these cases, it ends up being cheaper for the customer to pay in cash.

ATMs in and around fast food restaurants see around 75-150 transactions a month. Quick service restaurant ATMs see around 100-150 transactions a month. And you can expect 150-200 transactions a month from an ATM in close proximity to cafes, diners, and luncheonettes.

So consider the type of restaurant you’re looking at and determine whether or not it gets enough patrons to earn you as many transactions and revenue as possible.

7. Barbershops and Hair/Nail Salons

Similar to bars and restaurants, barbershops and salons are tip-heavy locations and usually charge customers extra to pay with a card because of the charge fee. 

These locations typically pass the fee on to the customer rather than taking it out of employee wages, so it ends up being cheaper for the customer to pay in cash. Without the fee, customers are more likely to tip more, so these locations strongly encourage cash payments.

Barbershop and salon ATMs see around 250-300 transactions a month. 

8. Microbreweries

This category kind of encompasses any new or trendy location. They bring in a lot of customers because of the novelty. People want to check out shiny, new locations especially if they’re bored with their previous options. These are also places people like to hang out. 

If a location draws a lot of people, you want all those people to pass by and use your ATM.

9. Parking Lots

Parking lots and parking garages are common in densely populated areas. That means that many people will be around regularly to see and use your ATM. Downtown areas and locations with a variety of shops and activities bring tourists and locals alike to spend cash all year round.

What all of these locations have in common is that they are places where people prefer to pay with cash and they are places many people like to go on a regular basis. The combination of traffic and need make ATM businesses successful in these areas.

Of course, your experience will vary. You know your town better than anyone else, so use our list of What Makes the Best Locations for ATM Machines to guide your search.

Site Location Agreement (SLA) and Revenue Split

Each of the 9 locations on our list of best locations for ATM machines will likely be owned by someone other than you. This means that you’ll have to talk to business owners to create a partnership for running the ATM.

Convenience stores get about 23% more in sales from ATM users. But while an ATM machine in itself can bring more sales to the location therefore benefiting the store, location owners will be most likely to let you use their space for a share of the ATM revenue.

So when choosing the best location for your ATM, make sure the contract between you and the site location owner is a win-win. You want to make as much profit as possible, so you’ll have to weigh the number of transactions you expect against the percent of revenue split between both parties.

Other Locations to Consider

A Retail Store You Own

If you own a retail store and are considering adding an ATM machine, you can add to your monthly profits. As long as you advertise it and make it visible to passers-by, an ATM machine could bring in more customers or at least more foot traffic in and past your store.

Encouraging cash payments could lower your credit card fees, and you can offer coupons on ATM receipts to push sales. Additionally, about 30% of the cash withdrawn from an ATM in a store is spent in that store. At the very least it encourages impulse buys.

So adding an ATM service to your existing business could be very profitable for you.

The Office Where You Work

This only works if your office meets the following criteria:

a. There are 100s of employees

b. There is a cafeteria or someplace to spend cash

The more employees there are, the more opportunities there are for ATM transactions. Before placing an ATM in your office, make sure there’s a good balance between the amount of traffic and need for the service.

Commercial Building

Large shopping centers are typically supplied with ATMs by banks, but smaller ones might not be. If you already know the owner of a commercial building, see who if anyone is providing them with ATM service. There might be an opportunity for you.

Condo Complex

Here again you have to consider the amount of traffic in addition to the need for ATM service. If there is a condo complex with many units and nearby locations to spend money, you might consider placing an ATM in a condo complex. Keep in mind that you will need to speak with HOA to get approval.

The Best Locations for ATM Machines

When scouting locations, look for high-traffic areas, cash-only locations or locations with a high rate of cash paying customers, and locations where other ATMs are scarce. You also want to look for places customers will feel safe using the ATM such as locations with lots of foot traffic.

Be aware of new businesses that might not have ATMs yet and locations where ATMs are old, outdated, and frequently out of order. These all make for great opportunities to get your foot in the door and ask about starting a partnership to run your ATM.

You can check out liquor stores, bars, restaurants, convenience stores, shopping centers, and parking lots. For your first ATM, it’s a good idea to choose a location close to home or work until you get used to the process. You can even look into setting up your ATM in the office or building where you work if there is enough of a demand for it.

If you haven’t set up a location yet and are nervous about approaching businesses, check out our article How to Get Your First ATM Placement. It covers how to borrow authority to give yourself credibility and what to say so that you can get other business owners to trust you and convince them to join a partnership with you.

Remember, the location of your ATM could make or break your success.

Starting Your ATM Business: ATM Business Contract and Other Documents

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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. 

ACH

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 ATMDepot.com 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.

Conclusion

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!

Meeting User Needs: User Requirements for ATM Machines

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It’s important to understand the user requirements for ATM machines because you want to make sure your equipment meets the needs of your customers. User requirements can be broken down into two categories: functional and non-functional. 

Functional and non-functional requirements, or functional specifications, are not terms specific to ATM machines. You can find these terms used within any business that develops software or systems. User requirements are often accompanied by business requirements and system requirements.

User requirements refer to user needs. For example, what the user actually does with the system (in this case ATM machines) and what activities the user should be able to perform. The customers and their needs inform manufacturer decisions about upgrades and model adjustments.

Now, there are both functional and non-functional user requirements. Functional requirements are mandatory. These are the requirements that users expect each time they visit an ATM machine. 

Non-functional requirements are not essential. These requirements are what can make or break the cost of a machine. Non-functional requirements can be left out to save on cost. As long as doing so does not negatively affect the user experience, of course. You might think of functional requirements as needs and non-functional requirements as wants.

For the purpose of this article, we will discuss what functional and non-functional user requirements look like when it comes to your ATM machine. Each has its place, but it’s important that you know what your machine offers your customers.

Functional Requirements for ATM Machines

Functional requirements refer to what the ATM machine should do. This includes ATM behaviors and how the ATM should react when certain conditions are met. For example, the ATM receives input, reacts, and delivers the appropriate output.

The advantage of functional requirements is that they help define service and behavior expectations. If something is missing or if there are errors, it is obvious and can be adjusted. And functional errors are typically relatively cheap to fix. 

Functional requirements support user goals, tasks, and activities. Let’s take a look at some examples of functional user requirements for ATM machines. 

Examples of Functional User Requirements for ATM Machines

Functional requirements are the mandatory actions the ATM should perform upon user request. We can automatically list those pretty easily: withdraw, deposit, transfer, pay bill, account balance, print receipt, exit. Now let’s look at some of those in terms of input and output. When a user

  • inputs the selection to withdraw funds, the ATM should dispense the selected amount
  • inputs the selection to receive an account balance, the ATM should display the available amount
  • indicates that all transactions have ended, the ATM should return the card and return to its idle state

Above we said that functional requirements refer to how the ATM should behave when certain conditions are met. For instance, when a user inputs the selection to withdraw funds, the ATM should dispense the selected amount from any suitable account linked to the card and upon approval from the bank. 

These functional requirements are not unconditional. The ATM can only respond accordingly under the appropriate conditions. Functional requirements include descriptions of

  • data entered into the ATM (card, PIN)
  • operations performed by each screen (withdraw, deposit, transfer)
  • workflows performed by the ATM (transferring funds, accepting envelopes, reporting deposits)
  • ATM reports or other outputs (dispensing cash, printing receipt)
  • who can enter the data into the system
  • how the ATM meets applicable regulatory requirements

When thinking of functional requirements, think of what the customer needs in order to perform his or her transaction. And of course there are many many more user requirements that fall under this category. 

But hopefully you get the idea. When the customer does X, the machine does Y. Functional requirements are the observable tasks or processes that must be performed by the ATM machine. So everything else is non-functional.

Non-Functional User Requirements for ATM Machines 

The qualities or standards the ATM must have or comply with are non-functional requirements. You might hear them referred to as supplemental requirements or quality of service requirements. They define how the ATM works and describe limits on functionality. So in other words, they specify criteria that judge the operation of the ATM rather than the specific behaviors of the ATM. 

While functional requirements answer “what” and “who,” non-functional requirements answer “how” and “to what extent.” And if non-functional requirements are not met, the ATM will still work. Functionality is not dependent upon non-functional requirements.

However, non-functional requirements do help make the ATM easy to use and enhance the ATM performance. They are properties, not features, and focus on user expectations rather than user requirements or needs.

Examples of Non-Functional User Requirements for ATM Machines

Some elements that come to mind when describing non-functional user requirements for ATM machines are accessibility, compliance, performance, security, and usability. 

Functional requirements refer to the ATM output itself. And non-functional requirements refer to how quickly the output is received, how easy it is to get the output, and how safely the output is obtained.

So non-functional requirements include safety functions like the key-operated power switch and operator panel. And security protocols like retaining the card after too many unsuccessful PIN attempts. Or performance indicators like speed of transactions.

A Side-by-Side Glance at Functional and Non-Functional Requirements

Again, functional requirements refer to the ATM behavior. Non-functional requirements define the ATM behavior per certain standards. Take a look at the following examples:

FunctionalNon-Functional
PINCorrect PIN allows transactionsMust be entered correctly within a certain number of attempts
Cash DispenserDispenses cashCan be opened and refilled with cash
PrinterReceipt printed upon demandCan be opened and refilled with paper
ATM StateDefaults to idle upon completion of transactionsCan be shut down and restarted
Functional vs. Non-Functional Requirements

Functional requirements refer to what the system should do. Non-functional requirements refer to how the system should fulfill those functional requirements. So functional requirements relate to components while non-functional requirements relate to the system as a whole.

The customer doesn’t care how cash is refilled, just that it dispenses cash when prompted. Nor does the customer care how the ATM is powered on and off, just that it’s on when he or she needs to use it. Make sense?

Why it is Important to Understand Functional and Non-Functional Requirements

You can think of these requirements from two perspectives. First, you can think in terms of your customers and users. For example, do the machines you provide offer them the options they both want and need? Are they happy to pay associated fees for these abilities? 

Second, you can think of yourself as the customer. What do you need and want from an ATM machine? Does the manufacturer meet those needs for a fair price? If the price is too high, what non-functional or supplemental requirements can you sacrifice to lower the scope or cost of the machine? 

And your answers to these questions might be based on your customers’ answers to the same questions. The purpose of functional and non-functional requirements is to make sure customers get a high quality product exactly as they expect it.

Keep this in mind as you shop for ATM machines from different manufacturers. Which model best meets your and your customers’ needs for the best price? Consider non-functional requirements as you weigh your options. ATMDepot.com provides detailed information for each machine listed on the website as well as owner manuals. Take a look and rest assured that you know exactly what you get before you purchase. Still have questions? Contact us today to speak with a representative!