Tag Archive for: ATM Equipment

How to Complete Your ATM Business Basic Checklist

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This ATM business basic checklist is for you to use as you go through the process of operating an ATM machine. If you’re looking for more of a step-by-step guide, check out our article How to Start an ATM Business in 5 Steps. 

However, if you are looking for a list of what needs to be done, this is it. Once you have completed each item in this ATM business basic checklist, you will officially be in business. You can’t neglect any of these items if you want to start operating your own ATM machines!

1. How to Find a Processor

What is ATM Processing?

You need to work with an ATM processing company so that your ATM machine can communicate with your customers’ banks. An ATM processor identifies the network of each card inserted into your ATM machine, routes the information to the user’s bank, verifies the funds, then receives approval from the bank to dispense the withdrawal amount up to what’s available in the account. Check out our video here for more information.

Factors to Consider

Although ATM processing is pretty basic, there are a number of factors to consider when choosing an ATM processing company. It is in your best interest to research a variety of companies to find the one that is going to best suit your business needs and transaction volume.

Now, if you’re just getting started, you might not know your transaction volume yet. But your processor might. Find an experienced company that will be able to assist you throughout your entire career as an ATM owner. 

Experience

An experienced company will be able to give you advice regarding the location you choose (keep reading this ATM business basic checklist for more information on choosing a location) as well as how much you can expect to make from that location or from alternative locations.

Support

You also want to work with an ATM processing company that wants you to make money. A company that acts as a business partner will offer you support throughout your entire career, not just during the initial setup. The company should offer training, ongoing support, and dependable support (meaning they answer the phone when you call…).

Other Services

Finally, you want to know what additional services the company provides. Not all ATM machines work with all processing companies, so if you choose a processor before your equipment, you might want to know if they also sell equipment. Because they will only sell machines that they can support.

If you purchase your equipment before choosing a processing company, you will have to make sure the company can support it. (More on deciding machine type next.) And you can switch processors after you are already in operation. Your needs might change, or you might not get the service you expect from your current processing company. In these cases, you will need to switch to a company that can support the machines you already have. 

Other services you might want to consider are vaulting, remote monitoring, and automated payments. This business is all about building passive income. So you want to minimize your workload as much as possible.

You can load your ATM machine (vaulting) yourself to make as much profit as you can. But if this isn’t convenient for you, your ATM processing company might offer this service. 

Remote monitoring allows you to track your machine’s activity and cash availability which makes it easier for you to keep it stocked and minimize downtime. And automated payments prevent you from having to spend time making transfers yourself and constantly online banking. The less time you spend managing your ATM, the more passive income you make.

When looking for an ATM processor, look for a business partner. Find out more about how to choose an ATM processor here.

2. How to Decide on Your Machine Type

You have lots of options when it comes to choosing ATM equipment. If you’ve already chosen an ATM processing company to work with, you will have to narrow your search to machines the company can support. If the company sells machines, this might be the simplest item on this ATM business basic checklist!

Machine Type

First, you need to decide if you want a freestanding machine, a through-the-wall (TTW) machine, or a wall mount machine. The three most important factors to consider when it comes to machine type are cost, space, and security.

TTW machines are the largest of the three types and therefore cost a little more. However, they are more secure because the vault extends into another room that can be secured during regular operation and vaulting. Unfortunately, they require a lot of space and some construction work to allow the machine to fit into the wall if the space doesn’t already exist.

Freestanding machines are smaller than TTW and are therefore a little cheaper. You also have more flexibility with the placement of a freestanding machine. Likely, a majority of the ATM machines you see day to day are freestanding.

Wall mount machines are the smallest of the three types. They are also the cheapest, but they don’t hold as much cash. Wall mount machines are a good option for slower locations. Despite the name, this type can be mounted to a countertop as well which makes them easy and convenient to place; they don’t take up a lot of space.

Manufacturers

Some of the biggest names in ATM equipment are Hyosung, Genmega, Hantle, and Triton. All are reputable companies that have been in the business for a long time and are known for producing quality equipment. 

Check out our ATM Buyers Guide for more guidance on choosing the ATM equipment that’s best for your business. We also compare Hyosung and Genmega, the two top of the line ATM manufacturers.

New vs. Refurbished

Finally, you have to weigh the pros and cons of a new vs. refurbished machine. It really comes down to your budget, your experience, and machine availability. 

We recommend starting with a new ATM machine at least for your first one. Newer models come with improved features and advanced technology making them easier to operate.

However, refurbished ATMs are also good options. It just depends on what is available and the quality of the refurbishment. If you have your heart set on a specific manufacturer or model, you might not be able to easily find what you’re looking for; you will more likely have to choose from what’s available. 

Most importantly, make sure you purchase certified refurbished if you choose to go this route. This guarantees that the machine has had standards checks, detailing, and upgrades applied.

3. How to Place Your ATM

If you own your own store, you can go ahead and mark this off of your ATM business basic checklist! If you plan to place your machine in someone else’s business or store, consider these factors:

  • Foot traffic
  • Proximity to other ATMs
  • Proximity to you
  • Liquor license

The busier the location is, the better the location’s reviews are, the more people that pass by it every day, the better your ATM is going to perform. People can’t use your machine if they don’t pass by it or see it, so you want to get as many eyes on your machine as possible.

You also want to corner the market. You will get more users the farther away your machine is from other machines. This way, you aren’t sharing customers; yours is the most convenient!

Remember that the goal is to build passive income. So the less time you spend managing your machine, the more you make! This is why it’s important to choose a location that’s convenient for you, too. If it’s close to the route you take often, either to and from home or work, you make more with less time and work (and gas!).

Finally, keep in mind that locations that have a liquor license are able to charge more for transactions. In our article 9 Best Locations for ATM Machines we share our experiences with ATMs in various locations. If you need help approaching location owners, check out our tips for cold calling or join ATM Depot’s Members Area for access to scripts you can use to negotiate a deal.

4. How to Decide Your Surcharge

Setting your surcharge is all about strategy. You want to strike a balance between a transaction fee that’s convenient for your users and profitable for you. If you’re just getting started, you need to make your return on investment (ROI) before you can start making a profit, so you want to do this quickly. There are two ways you can do this:

First, you can set a surcharge that is lower than the competition to increase the number of transactions your machine receives. Second, you can match the competition or set a higher surcharge to try to make more per transaction. 

However, it isn’t as simple as that. It all depends on your location, the amount of foot traffic, the demand for your service, and your proximity to other machines.

Fortunately, we have a comprehensive guide for How to Set Your ATM Surcharge. Furthermore, you can always adjust your surcharge, so don’t stress out about it too much. Trial and error will play a big role in making sure you get it just right!

Completing Your ATM Business Basic Checklist

You know what you need to do, but how do you do it? This ATM business basic checklist is just the start. That’s why choosing the right ATM processing company is so important. Because you want support from beginning to end. Whether it’s asking questions, strategizing, or filling your pockets, your ATM processor should be there every step of the way making sure that you are successful. If you have questions about choosing a processor, purchasing ATM equipment, placing your ATM, or setting your surcharge, contact us today!

ATM Business Basic Checklist via ATMDepot.com
Want to start your own ATM Business? Make sure you check off all of the items on this checklist before you get started so that you’re prepared.

ATM Business Basics Part I: How ATMs Work

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Running an ATM business is a relatively simple endeavor. However, there’s some ground level knowledge that you need to be a successful ATM owner. A big part of that knowledge base is how ATMs work.

While you don’t need to be an ATM technician (you can always pay one to service your ATMs if you need), it’s important to have basic working knowledge of your ATMs. That way you can identify and solve minor problems, and quickly add cash or refill the receipt paper. This makes your ATM business more efficient in terms of both time and expenses.

So, welcome to our two-part guide that will give you a solid foundation of information on which to build your ATM business. We’ll start with the basics of how ATMs work.

How ATMs work

As the name suggests, an ATM (Automatic Teller Machine) a banking terminal where users can perform a variety of banking activities, depending on the capabilities of the ATM machine itself.

Inserting a debit card or credit card that offers cash advances activates the ATM. The ATM authenticates the debit or credit card using a PIN number, electronically debits the cash amount from the user’s account, and dispenses that withdrawal as cash.

On the backend, the bank reimburses the ATM owner for the cash taken from the ATM, plus a transaction fee, which is paid by the ATM user. This is handled electronically by the ATM processor.

That’s the basic process. These are the parts involved in this process.

The parts of an ATM machineThe Parts of an ATM Infographic

We’ll cover these quickly in two groups: the parts that the user sees, and the parts that you, the ATM owner, need to know.

These are the user-facing parts involved in an ATM transaction:

Display (LCD or LED): The display is where the prompts and instructions are shown to the ATM user. ATM machines are equipped with braille and audio devices (speaker or headphone jack) for blind customers.

Keypad: The keypad is simply a grid of buttons that accepts input from the user. Many ATM machines also have buttons on the sides of the screen for making certain selections

Card reader: This accepts the user’s debit or credit card and reads the information on it.

Cash dispenser: This is where the magic happens. The cash dispenser gives customers their cash. The cash dispenser also checks notes for proper size and thickness and ensures that the correct number of bills are given.

Receipt printer: This part prints the receipt that verifies the transaction, and sometimes shows the user’s account balance.

These are the parts of an ATM that the customer interacts with. You as the ATM owner need to be familiar with these parts. However, the ATM owner also needs to know their way around the internals of an ATM machine, even if they’re not an expert in repairing or replacing those parts.

These are the internal parts of an ATM machine:

ATM mainboard: The mainboard is the central “computer” for the ATM. The CPU, RAM, and connection interfaces for the other components live here.

Power supply: Connects to an external power source and provides power for all the ATM machine components.

Modem: The modem performs all the internet communications required for transaction processing. This can be wired or wireless. It depends on how the ATM connects to the internet.

I/O board: The I/O board is in charge of communicating with the ATM processor, and ensuring that the correct information is sent to the correct parties.

Cassette: The cassette is an important part for the ATM owner. The cassette holds the cash. When you stock an ATM with money, this is where the bills go. The cassette can be fixed or removable. Each type of cassette has pros and cons. Which one you use depends on your business and the ATM location.

How Does an ATM Machine Work?With all the parts covered. Here’s a more detailed look at how an ATM works:

  1. The user activates the ATM by inserting their card.
  2. The customer enters their PIN and selects how much cash they want using the keypad and display.
  3. The mainboard collects the information and sends a unique EMV transaction code to the I/O board.
  4. The I/O board packages up the transaction information for the ATM processor and the modem transmits it to the appropriate ATM processing networks. Your card’s supported networks are printed on the back. Every card is required by law to have two accessible networks. The transaction is completed through the secondary network if the first network fails.
  5. The ATM processor sends the withdrawal request to the bank. The bank approves or denies the request. If the transaction is approved, the message is sent back through the ATM processor to the ATM. Then, the selected amount gets debited from the customer’s account. Associated transaction fees are usually paid from the customer’s account.
  6. The modem and I/O board receive the approval. And, the mainboard initiates the cash dispensing. The cash dispenser checks each bill to ensure that it’s the proper size and thickness and that the correct number of notes gets dispensed. Notes that are not the proper size or thickness get sent to the reject bin. This happens occasionally with old or torn bills. The cash dispenser automatically dispenses a different bill any time a note is sent to the reject bin.
  7. The customer takes their cash and has a great day!

Those are the nitty-gritty details of how ATMs work.

It’s helpful to know these fine details as an ATM owner. Being more familiar with the machine helps with basic troubleshooting, and makes life easier if you get technical support over the phone.

However, you should be very familiar with the cassette and user interface. Inspect these each time you restock your ATM. You need to fix your machine ASAP if the user interface is malfunctioning or cash is being dispensed incorrectly. You lose money whenever your ATM isn’t working.

Whenever you fill your ATM with cash, it’s best to perform a transaction to verify that your machine is working correctly.

Front to back

That’s the frontend of an ATM business. In the next part, we’ll talk about what happens on the backend and where all the transaction fees go. Stay tuned. Or learn more about building your own ATM business (and how you make money).

 

How to Load an ATM Machine

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Tag Archive for: ATM Equipment

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