How ATMs
Work You’re short on cash, so you walk over to the
automated teller machine (ATM), insert your card into the card reader, respond
to the prompts on the screen, and within a minute you walk away with your money
and a receipt. Have you ever wondered about the process that makes your bank
funds available to you at an ATM on the other side of the country ATM
Card vs. Check Card As an alternative to writing checks and
using a credit card, most major banks have teamed up with major credit-card
companies to issue check cards. Check cards are different from
straight ATM cards in a couple of ways. First,check cards are also known as
debit cards because of how they work—instead of getting credit for your purchase
and receiving a monthly bill,like you do with a credit card, a check/debit card
deducts money from your checking or savings account. Also, while
you can only use your ATM card at the ATM machine (and some grocery stores), you
can use a check card at most retailers that accept credit cards.
There are exceptions. Some hotels and rental car services only accept
credit cards because it’s easier, cheaper, and less of a risk to them than check
cards. Those that do accept check cards often put a certain amount of money in
your bank account "on hold" (unavailable to you) usually the cost of the room or
rental including taxes and other fees, plus a percentage of the total or a fee
to cover possible damages. When you check out of the hotel or turn in your
rental car, the difference between the"hold’amount and what you’re actually
billed is released back into your account. This is something to consider when
using your debit card to reserve a hotel room or rent a car. The Way ATMs
Work An ATM is simply a data terminal with two input and
four output devices. Like any other data terminal, the ATM has to connect to,
and. communicate through, a host processor. The host processor is analogous to
an Internet service provider (ISP) in that it is the gateway through which all
the various ATM networks become available to the cardholder (the person wanting
the cash). Most host processors can support either leased-line
or dialup machines. Leased-line machines connect directly to the host processor
through a four-wire, point-to-point, dedicated telephone line. Dialup ATMs
connect to the host processor through a normal phone line using a modem and a
toll-free number, or through an Internet service provider using a local access
number dialed by modem. Leased-line ATMs are preferred for very
high-volume locations because of their thru-put capability, and dial-up ATMa are
preferred for retail merchant locations where cost is a greater factor than
thru-put. The initial cost for a dial-up machine is less than half that for a
leased-line machine. The monthly operating costs for dial-up are only a fraction
of the costs for leased-line. The host processor may be owned by
a bank or financial institution, or it may be owned by an independent service
provider. Bank-owned processors normally support only bank-owned machines,
whereas the independent processors support merchant-owned machines.
Sensing Bills The cash-dispensing mechanism has an
electric eye that counts each bill as it exits the dispenser. The bill count and
all of the information pertaining to a particular transaction is recorded in a
journal. The journal information is printed out periodically and a hard copy is
maintained by the machine owner for two years. Whenever a cardholder has a
dispute about a transaction, be or she can ask for a journal printout showing
the transaction, and then contact the host processor. If no one is available to
provide the journal printout, the cardholder needs to notify the bank or
institution that issued the card and fill out a form that will be faxed to the
host processor. It is the host processor’a responsibility to resolve the
dispute. Besides the electric eye that counts each bill, the
cash-dispensing mechanism also has a sensor that evaluates the thickness of each
bill. If two bills are stuck together, then instead of being dispensed to the
cardholder they are diverted to a reject bin. The same thing happens with a bill
that is excessively worn, torn, or folded. The number of reject
bills is also recorded so that the machine owner can be aware of the quality of
bills that are being loaded into the machine. A high reject rate would indicate
a problem with the bills or with the dispenser mechanism. Settlement
Funds When a cardholder wants to do an ATM transaction, he
or she provides the necessary information by means of the card reader and
keypad. The ATM forwards this information to the host processor, which routes
the transaction request to the cardholder’s bank or the institution that issued
the card. If the cardholder is requesting cash, the host processor causes an
electronic funds transfer to take place from the customer’s bank account to the
host processor’s account. Once the funds are transferred to the host processor’s
bank account, the processor sends an approval code to the ATM authorizing the
machine to dispense the cash. The processor then transfers the cardholder’s
funds into the merchant’s bank account, usually the next bank business day. In
this way, the merchant is reimbursed for all funds dispensed by the ATM.
ATM Security ATMs keep your personal identification
number (PIN) and other information safe by using encryption (加密) software such
as Triple DES (Data Encryption Standard). But there are lots of things that you
can do to protect your information and your money at an ATM.
Many banks recommend that you select your own PIN. Visa offers the
following PIN tips: Don’t write down your PIN. If you must write
it down, do not store it in your wallet or purse. Make your PIN
a series of letters or numbers that you can easily remember, but that cannot
easily be associated with you personally-such as birth dates, initials, house
numbers or your phone number. Visa also recommends the following
tips for safe ATM usage, Store your ATM card in your purse or
wallet, in an area where it won’t get scratched or bent. Get
your card out before you approach the ATM. You’ll be more vulnerable to attack
if you’re standing in front of the ATM, fumbling through your wallet for your
card. Stand directly in front of the ATM keypad when typing in
your PIN. This prevents anyone waiting to use the machine from seeing your
personal information. After your transaction, take your receipt,
card and money away. Do not stand in front of the machine and count your
money. If you are using a drive-up ATM, get your vehicle as
close to the machine as possible to prevent anyone from coming up to your
window. Also make sure that your doors are locked before you drive up to the
machine. Do not leave your car running while using a walk-up
ATM. Take your keys with you and lock the doors before your
transaction. If someone or something makes you uncomfortable,
cancel your transaction and leave the machine immediately. Follow up with your
bank to make sure the transaction was cancelled and alert the bank to any
suspicious people. For safety reasons, ATM users should seek out
a machine that is located in a well-lighted public place. Federal law requires
that only the last four digits (阿拉伯数字)of the cardholder’s account number be
printed on the transaction receipt so that when a receipt is left at the machine
location, the account number is secure. However, the entry of your four-digit
personal identification number (PIN) on the keypad should still be ob- scured
from observation, which can be done by positioning your hand and body in such a
way that the PIN entry cannot be recorded by store cameras or store employees.
The cardholder’s PIN is not recorded in the journal, but the account number is.
If you protect your PIN, you protect your account. By using a check card, a consumer receives credit as well as a monthly bill when a buying is done.