How to Start an ATM Business with No Money

If we said we could tell you how to start an ATM business with no money, would you believe us? It’s no secret that an ATM business has low startup costs compared to other business models. That’s one reason why it’s the ultimate side hustle.

Of course, starting an ATM business will require some startup money. But what if you could find other ways to come up with the money? What if you could start an ATM business today without thousands of dollars already saved up? Here, we’ll share some tips that can allow you to get creative with funding your business. Then, you’ll be left with absolutely no excuses keeping you from getting started.

How to Purchase Equipment

The biggest startup cost will be the ATM machine or equipment itself. You can expect this to cost around $2,000-$3,000 for just one machine. That is considerably low compared to what it costs to start a brick and mortar or other business. But not everybody has that kind of money available. So, if you want to know how to start an ATM business with no money, you have a few options.

Use a Credit Card

If you have a credit card or can open one, you can purchase an ATM machine on credit. The cost of a machine is usually within the range of credit limits. Plus, you can find a good deal where you are offered little or no interest for a certain period of time. This allows you to start generating revenue before interest accrues. This can speed up your return on investment (ROI). You even have the chance to pay off the balance with your ATM revenue before the interest kicks in!

Lease

Another option is ATM leasing, but it is much less common these days. The price of ATM equipment is not as high as it used to be. So, it often makes more sense to purchase a machine on credit than to lease. Unless you’re considering purchasing several ATM machines, it might be more profitable to borrow instead of lease due to the rates on bank financing.

If you have great credit and only want to lease the actual ATM equipment, you can get a lease for as low as $55/mo. Benefits of leasing include a fixed payment, tax deduction, and recuperation of your monthly payment by your business revenue. 

However, an out-right purchase has an ROI of between 3 and 18 months depending on the situation. The national average of all our ATM operators have an ROI of 8.5 months based on a $2 surcharge. Thereby, you avoid the necessity of a long-term ATM machine lease.

Apply for a Loan

You might not have friends and family willing and able to lend you some money to start your ATM business. But you may be able to get a line of credit (LOC) from your bank or other commercial lender. Since $5,000 is a very small loan (microloan), you could consider increasing the line to help cover other expenses if you choose to go this route. 

It’s a bit of a hassle to get a loan. So it might not be worth it to get a loan for less than $25,000 when you could purchase the equipment with a credit card. But some banks will open an LOC for $5,000-$15,000 if you have a good track record with them and decent credit. 

To apply for an LOC, simply visit your bank or other institution where you have money in an account. Interest on a regular loan starts immediately. But on an LOC it only starts once you take the cash, and you only pay interest on the outstanding balance. So prepare yourself before you start using it. Keep in mind, too, that most traditional business start-up loans will require a decent credit score.

Qualify for a Financing Program

Third party business funding is a great way to get cash if you have locations waiting for ATMs and simply need to find the money to purchase the equipment. You can see if you qualify to get financing to start your ATM business. There is no charge to check, and no inquiry will go on your credit report.

All you do is fill out the quick pre-qualification application. Then, a financing representative will give you a call to collect the rest of your information. A soft inquiry will follow. Lastly, the financing rep will let you know what you’ve been approved for in your area based on your credit.

You will know within minutes whether or not you have been approved. If you proceed with the loan, the third party loan provider will work on your behalf to secure multiple revolving credit cards (up to ten) with varying amounts of credit. The total available line of credit could be between $25,000 and $100,000 based on your creditworthiness. So this is really only an option if you are looking to purchase multiple machines. 

The third party will work to secure all of your credit cards to include up to 18 months of no interest. You complete the online form. They qualify you for free and do all of the work to secure your loans without inquiries on your credit report. There is no upfront fee; you don’t pay anything out of pocket. 

However, upon approval and when you receive your first revolving line of credit, a flat fee of $2,997 charges to the first credit card you receive. This way, you’re not out of pocket and have up to 18 months to pay the fee and any other charges you incur on the cards received.

How to Provide Vault Cash

Another ATM business expense is the vault cash. This is the money you will load into the machine for your customers to withdraw. Now, at the end of the day this money is yours, but it will be tied up in your business. And you need it immediately. So how can you easily get $2,000 cash to stock your ATM machine?

Other People’s Money

One option is what we like to call other people’s money, or OPM. Technically, OPM is a slang term used in finance to refer to financial leverage in the form of borrowed capital that is used to increase the potential returns as well as the risks of an investment. However, in the case of an ATM business, it simply means you can fund your venture with help from family, friends, or a business partner in return for an agreed upon share of your business revenue.

Financing

If you decide to finance your business, you might be able to cover your cash needs from this same source. However, keep in mind that normally the credit cards aren’t used for obtaining vault cash. But, if you speak with the loan provider, you may be able to pay an additional small fee to pull cash off the cards.

Location Funding

This is probably the most common option for cash vaulting when an ATM operator is short on funds. You can make this service part of the agreement with the location owner. When you negotiate the placement of your ATM machine in someone else’s business, you will need to discuss the need for the location to provide the vault cash as part of the agreement. 

Obviously, this is only an option if the location owner agrees to this arrangement. In this scenario, you will need to be willing to offer a larger share of your surcharge revenue. This will compensate the location owner for the extra work and responsibility. You will also end up reliant upon him or her for the seamless operation of your business. 

For example, if something happens where the location owner fails to restock the machine, you are out of business until you have cash to offer customers. If you are able to handle the vaulting yourself, on the other hand, you have more control over your business and assume less risk of down time.

What Can Wait

Finally, when planning how to start an ATM business with no money, you want to make sure you stick to the bare necessities to start. Purchase just enough to get going. Then, as you begin to generate revenue with your machine, you can budget for other add-ons and services to enhance your business as you go. 

You will have a lot of options to choose from when it comes to purchasing equipment. You will have to consider screen size, lighting, cassettes, locks, cameras, etc. But many of these upgrades can be added later; they aren’t completely necessary to get started.

Be strategic as you weigh “need to have” against “nice to have”. Bells and whistles can always be added. But you also want to make your ROI as soon as possible. You can only do that with a competitive machine. So if you need help making these decisions, talk to someone with experience in the industry or a trusted ATM vendor. 

How to Start an ATM Business with No Money

The cost to start an ATM business is so low that you technically now know how to start an ATM business with no money. Keep your initial budget limited to equipment that is need to have versus nice to have. Borrow from friends and family when you can, or enter into a business partnership. Seek financing when it makes sense for your business model. Work with a reputable financier who will offer you a fair deal based on the revenue you anticipate and the rate at which you will reasonably be able to make your ROI.

If you still have questions about how to start an ATM business with no money, don’t hesitate to contact us today! You can also check out our comprehensive list of FAQs about how to get into the ATM business. These answers provide more information about what you can expect when getting started.