ATM Full Form

ATM stands for Automated Teller Machine. ATM is an electronic machine that is used for financial transactions. ATM allows customers for cash withdrawals from their respective bank accounts without them visiting their bank branch. It is a convenient and trouble-free platform where the customers can self-service all their transactions like cash withdrawal, cash deposit, amount transfers without the help of any bank representative. On the transaction, a nominal fee is charged by the operator of the ATM that does not hold our account. This fee can be avoided if we use the ATM of the respective bank in which our account is present. ATM is a much-used option all around the world and in some parts, it is also called Automated Bank Machines. 


The bank authorities provide the customer with an ATM card and a pin code to access the card. When this ATM card is inserted in any ATM machine the machine asks for a PIN to be entered. The customer has to enter the PIN that must match the PIN that is stored in the chip of the card. Once the correct PIN is entered, the customer gains access to their bank account and thus they can carry on with their transaction.


The first device that was operational was known as ‘Computer Loan Machine’. This device was supplied by the Japanese in the year 1966. The machine used to dispense cash as a loan basis after the insertion of a credit card into the machine. 

The cash machine was first bought in use in the year 1967 at the branch of Barclay’s Bank in North London. This machine was inaugurated by actor Reg Varney. Later in the year 1970, after a discussion with other banks, the card of one bank could be used in other bank’s ATM for transactions. Now ATM is a worldwide used facility which makes the life of people much simpler. There are around more than 3 million ATM’s that are used across the world. 

Types of ATM:

The 2 basic types of ATM are:

  1. Onsite ATM: The ATM of the respective branch resides within the premises of the bank branch.

  2. Off-site ATM: The ATM machine is present elsewhere than the bank premises. This is done to make sure people can have better access to their facilities despite the bank branch being far. It is one of the ways the bank gets its promotions for easy accessibility.

The other varieties of ATM are based on the labels they are given:

  1. White label ATM: These are owned by the entities other than the particular bank. There is no logo of any bank on the ATM machines. The first one to be introduced was by the TATA group.

  1. Brown label ATM: These ATMs are operated by the third party other than the bank.

  1. Green label ATM: These ATMs are used for agricultural transaction purposes.

  1. Yellow label ATM: These ATMs are used for the purpose of E-commerce.

  1. Orange label ATM: Is used for share transactions.

  1. Pink label ATM: There are specifically made for access to females for them to avoid any long lines to make their transactions.

  1. Biometric ATM: This ATM uses biometric features like an eye scanner or a fingerprint scanner to be operated. 

ATM Machine Parts

ATM all around the world are designed differently but they have some basic parts setup. 

1. There is a display screen that looks much like the screen of a computer monitor. 

2. A speaker through which the instructions can be heard regarding the access to the machine. 

3. A card reader is present in which the card has to be inserted soon after which the display shows some options like language, transaction details, and customer ID or PIN after which the person can have access to their account. 

4. The keypad is present in which the customer has to type the information the machine asks for the transaction to take place.

5.  Cash dispenser is present through which the cash can be collected. The cash is safely and securely stocked into the machine by the bank officials for the customer transaction. 

6. A receipt printer is present which prints a sheet that displays the transaction details.

FAQ (Frequently Asked Questions)

1. How many transactions are free in ATM?

Normally three transactions are free in ATM after which the bank charges some nominal amount as a fee for the transaction. It also depends upon bank to bank how many free transactions they offer.

2. What is the cash withdrawal limit in ATM in India?

The withdrawal limit is set by a particular bank under the guidance of RBI. The limit cannot exceed 50,000 per day. Few government banks have a lesser withdrawal limit that can be as less as 20,000.