INDEX

CHAPTERS CONTENTS PAGE NO.

1 INTRODUCTION
 HISTORY
 WHAT IS ATM?
 WHY ATM?

2 REVIEW OF LITERATURE

3 ATM REVOLUTION IN BANKING INDUSTRY

 CASH TECHNOLOGIES INC
INTRODUCTION NEW TRANSACTION
PROCESSING SYSTEM TO
REVOLUTIONIZE THE TRANSACTION
ATM

4 SERVICE OF ATM
 CASH WITHDRAWALS
 BALANCE INQUIRY
 MINI STATEMENT
 DEPOSIT CASH
 FUND TRANSFER
 CHEQUE BOOK REQUEST
 PIN CHARGE
 PAYMENT

5 HOW TO USE ATM?

6 TOP 15 USES OF ATM

 SHOPPING
 QUICK TELLER OPTION
 CASH WITHDRAWALS

1
 7 PRINCIPLES OF ATM

8 FUNCTION OF ATM

 THE BEGINNING – GETTING CASH AT

ATM

 THE NEXT STEP – PAYING WITH ATM

CARDS

 THE LATEST NEWS / SHOPPING

WHEREVER SOME MAJOR CARD

BRANDS ARE ACCEPTED

 ATM ON INTERNET

9 LIMITATION OF ATM

 YOU CAN ONLY SPEND WHAT YOU HAVE

 THERE MAY BE DAILY SPENDING AND

WITHDRAWALS LIMIT

 RECORD KEEPING REQUIREMENT

 HIDDEN FEES

 LOST OR STOLEN CARD

 EASE OF OVERSPENDING

10  ADVANTAGES OF ATM

 USING YOUR ATM CARD TO SHOP

MATCHING THE LOGOS

 MAKING A PURCHASE

 AN ATM CARD WILL BE ACCEPTES FAR

2
 MORE READILY THAN AN OUT OF –

STATE CHECK

 SMARTER ABOUT ATM CARD

 USING AN ATM CARD CAN GIVE YOU

THE TOOLS TO BE A SMARTER MONEY

MANAGER

 SMART MONEY MANAGEMENT HABIT

11 HOW TO GET A BASIC ATM CARD AND ONE

YOU CAN USE TO SHOP

12 NATURE OF ATM

 ATM ON NETWORK

 ATM ASYNCHRONOUS TRANSFER MODE

 THE ATM LAYER

13 SCOPE FOR ATM IN INDIA

14 STRATEGIC TIE-UPS FOR ATM CENTER

15 LIMITATION OF DEMONETIZATION ON

ATM CENTRE

CASE STUDY

RECOMMENDATIONS

BIBLIOGRAPHY

WEBILIOGRAPHY

3
 EXECUTIVE SUMMARY:

One of the important services provided by the banks today is of ATM

To briefly summarize the process, an automatic teller machine or ATM allows a bank
customer to conduct their banking transactions from almost every other ATM
machine in the world. In the introductory stages, of the ATM, Don Wetzel invented
the first successful and modern ATM in the USA.
However he was not the first inventor to create an ATM. In 1939, Luther George
Simjian started patenting an earlier and not so successful version of an ATM. The
concept of the modern ATM first began in 1968, a working prototype came about in
1969 and Docutel was installed a patent in 1973. The first working ATM was
installed in a New York based chemical bank

4
 OBJECTIVES OF STUDY:
 To understand meaning and history of ATM.

 To understand ATM REVOLUTION in banking industry.

 To understand how to use ATM machine.

 To understand principle of ATM.

 To understand scope of ATM.

 To understand limitation of demonetization on ATM centre.

5
ATM REVOLUTION IN INDIA

6
CHAPTER-1 INTRODUCTION

Automated Teller Machine (ATMs) has gained prominence as a delivery channel for
banking transactions in India. Banks have been deploying ATMs to increase their
reach. As at the end of December 2007, the number of ATMs deployed in India was
32,342 From first day of April 2009, entire ATM network is now available to
customers from any bank for transactions for no fee at all, irrespective of the banks in
which they have their accounts, now customers will not be levied any fee on cash
withdrawals using ATM and debit card issued by other banks. This will in turn
increase usage of ATMs in India.

More people are now moving towards using the automated teller machines (ATM) for
their banking needs. According to a survey by Banknet India, 95% people now prefer
this modern channel to traditional mode of banking. Almost 60% people use an ATM
at least once a week.

Increased ATM usage is also helped by the fact that customers have now the
flexibility of using ATMs of other banks, as most of the banks are part of major
interbank networks like National Financial Switch (NFS), Cashtree and cashnet. The
interbank networks have brought together ATMSs of several banks so that consumers
would gain access to any of the participating banks ATMs. Banks find it cheaper to
pay membership fees to these networks as against setting up additional units in
expensive to deploy areas.

ATMs are now seen to be more than mere cash dispensing machines. Customers use
ATMs to recharge their mobile phone prepaid connections, pay their utility bills even
Mutual fund transactions – making them at par with flexibility given in internet
banking – only more secure. Of the value-added services provided at ATMs, bill
payment is the most used service, followed by prepaid mobile talk-time recharges.
However, still about one third of the respondents do not use any value-added services
at ATMs.

7
The ATM market in India is not yet saturated. Though the concentrations of ATMs
are greater in metros, the demand is increasing for other cities and even rural areas.
ATMs per million people approximately are 33 units are very low. Experts forecast
that the growth rate. I is expected to grow 18 percent up by 2013. Banks going into a
self service model can have huge saving potential for banks and may also increase
convenience for the customers.

HISTORY
The first Automated Teller Machine (ATM) was introduced in the year 1967
by BNarclays Bank in Enfield Town in North London. At that time a few would have
anticipated excess in ATMs. Then many years after, the aim was to shift people off
the teller lines thus lowering a banks distribution costs and increase efficiency. But in
the 1980s, it was notified that people continued to visit branches, though not as
frequently, so that with the costs of ATMs, overall distribution costs were actually
rising.

Then, in the 1990s, came surcharges, which fuelled the proliferation of off-premises
ATMs, which led in turn to the current overcapacity. There was a slowdown in ATM
transactions, partially because of the consumer’s reaction to the imposition of
purchase. Also by the advent of surcharging there was a massive growth in the
number of ATMs as it offered ATM owners revenues making it economical to install
ATMs where they might not have been placed otherwise.

As is often the as with inventions, many inventors contribute to the history of an

invention. In the case of the ATM, Don Wetzel invented the first successful and
modern ATM in the USA, however he was not first inventor to create an ATM. In
1939, Luther George Simjian started patenting an earlier and not-so-successful
version of an ATM.

WHAT IS ATM?
A cash machine, also known as an automated teller machine[ (ATM, automated
banking machine (ABM), cashpoint, cashline, minibank, bankomat or colloquially
hole in the wall is an electronic telecommunications device that enables the

8
customers of a financial institution to perform financial transactions, particularly cash
withdrawal, without the need for a human cashier, clerk or bank teller.

According to the ATM Industry Association (ATMIA), there are now close to 3
million cash machines installed worldwide.

On most modern cash machines, the customer is identified by inserting a plastic ATM
card with a magnetic stripe or a plastic smart card with a chip that contains a unique
card number and some security information such as an expiration date or CVVC
(CVV). Authentication is provided by the customer entering a personal identification
number (PIN).

Using a cash machine, customers can access their bank deposit or credit accounts in
order to make a variety of transactions such as cash withdrawals, check balances, or
credit mobile phones. If the currency being withdrawn from the cash machine is
different from that in which the bank account is denominated the money will be
converted at an official exchange rate. Thus, cash machines often provide the best
possible exchange rates for foreign travellers, and are widely used for this purpose.

WHY ATM?

 Increased bandwidth and real-time responsiveness.

 Advantages over Ethernet networks.
 Limitations of Token Ring and FDDI networks.
 High performance of ATM networks.
 ATM is a world wide recognized standard, with which a universal information
exchange can be realized for the first time, independent of the type of end
system and service (data, video, audio).
 ATM is suitable for LANs as well as WANs.
 ATM is able to handle all existing information services simultaneously and
efficiently.
 Since ATM is scalable and therefore available in all speed classes.
As a general rule the maximum achievable BW for copper

9
CHAPTER-2 LITERATURE REVIEW

“Dr. Rangarajan committee had drawn up in 1983-84 the first blue print for
computerisation and mechanisation in banking industry and looked into modalities of
drawing up a phased plan for mechanisation for the banking industry covering period
1985-89. The committee in its report in 1984 recommended introduction of
computerisation and mechanisation at branch, regional office / zonal office and head
office levels of banks.” -Dr. C. Rangarajan Committee [1983]

“The Governor, Reserve bank of India had appointed a committee on technology

issues under the chairmanship of W. S. Saraf. The committee looked into
technological issues related to the payment system and to make recommendations for
widening the use of modern technology in the banking industry. The Saraf committee
recommended to set up institutions for electronic funds transfer system in India. The
committee also reviewed the telecommunication system like use of BANKNET and
optimum utilization of SWIFT by the banks in India.”
-W.S. Saraf Committee [1994]

“RBI formed a committee under the chairmanship of K. S. Shere, to study all aspects
relating to electronic funds transfer and propose appropriate legislation. The Shere
committee had recommended framing of RBI (EFT system) regulations under 59
section 58 of the Reserve bank of India Act 1934 (RBI Act.), amendments to the RBI
act and to the bankers book evidence act, 1891 as short term measures and enacting of
a few new acts such as EFT act, the computer misuse and data protection act etc. as
long term measures.” -Shere Committee [1995]

“In order to examine the various issues related to the technology upgradation in the
banking sector, the Reserve Bank of India appointed Narasimhan committee in
September 1998. The committee consists of representatives from the Government,
Reserve Bank of India, banks and academic institutions associated with the
information technology.

-Narasimhan Committee [1998]

10
CHAPTER-3 ATM – REVOLUTION IN BANKING
INDUSTRY
As is often the case with inventions, many inventors contribute to the history of an
invention. In the case of the ATM, Don Wetzel invented the first successful and
modern ATM in the USA, however he was not first inventor to create an ATM. In
1939, Luther George Simjian started patenting an earlier and not-so-successful
version of an ATM.

 Cash Technologies Inc. Introduces New Transaction Processing

System to Revolutionize the Traditional ATM

According to ATM developer and DocuTel employee Don Wetzel, “we never did see
the ATM as just a cash dispenser. We thought it had to be a machine that did most of
the functions of a teller including transferring money, taking payments and issuing
cash advances. But, nearly 30 years later, the ATM is still not much more than a cash
dispenser. In fact, out of the nearly 220000 ATMs installed in the U.S., research
shows nearly half provide only cash dispensing transactions. And, only five percent of
the remaining ATMs do anything more than the original, basic bank account
functions—even though consumers are demanding more twenty-four hour services
from their local bank.
 Important reason for possessing ATM Card

Dichotomy Label Count Responses % of cases

Bank offered free 34 18.7 34

Emergency purpose 54 29.7 54
Availability of
50 27.5 50
many ATM centers
24 hours availability
42 23.1 42
of cash
Other reasons 2 1.1 2
Total Responses 180 100 182

11
Analysis that can be made from the table and the graph is that the main purpose why
people possess ATM card is to deal with the emergency purpose, 54% of the
respondents had emergency purpose as a reason to possess ATM card 50% of
respondents responded availability as reason and 42% had 24-hour accessibility as
reason for processing ATM card. According to 34% of respondents the processed the
ATM card as bank offered the card free.

Reason for possessing ATM Card

1%

Bank offered free 19%

19%
23%
Emergency purpose 30%

Availability of many ATM

centeres 27%
24 hours availability of cash
30% 23%
27% Other reasons 1%

12
CHAPTER-4 SERVICES OF ATM
The following are the features available on Banks ATMs, which can be accessed from
anywhere at any time.
1. Cash Withdrawals:
A customer can withdraw up to Rs. 15000/- on a single day on his account. In
this, the Fast Cash option shows prefixed amounts, which a customer can
choose from, and Ultra Fast Cash option to withdraw Rs.3000/- at one time.

2. Balance enquiry:
Customer can know the ledger balance and available balance with his account.

3. Mini statement:
Customer gets a receipt printout of his last 8 transactions and the balance.

4. Deposit cash/ cheques:

Available in all full function ATMs, customer can deposit both cash and
cheques in the ATM. Cash deposited in ATMs will be credited to the account
on the same day and cheques sent for clearing on the next working day.
5. Funds transfer:
Customer can transfer funds from one account to the linked account in the
same branch.

6. Cheque book request:

Request for a cheque book from ATMs and their concerned branch will
dispatch it’s such that it reaches the customer within 10 working days.

7. PIN Change:
The customer changes the Personal Identification Number (PIN) of the ATM
or debit card.
8. Payments:
This is the latest feature on banks ATMs, its functionality can be used for
payment of bills, donating to temples/ trusts or making airtime recharges for
prepaid mobile phones.

13
CHAPTER-5 HOW TO USE ATM?
ATMS, which stands for Automated Teller Machine, are an easy way to access your
bank account from almost anywhere. If your new to them, don’t worry. Although
they may appear Daunting to use, all the instructions needed to operate them appear
Right on the machine.
There are few steps to withdrawal cash from ATM:
Step 1: Insert Card. Insert Card....
ATM cards come in two types — debit cards and credit cards.
Debit cards are mostly used in ATMs, and it offers you to withdrawal cash which you
have in your savings account. Vice versa from credit card you could credit money
from your account.
But in today’s topic we will discourse about the process of withdrawal money from
ATM through your card.
Now first insert your ATM card in the ATM machine.(you may see a blinking green
light in the machine, where you have to put your card.) please mind to insert your card
as the picture shows; otherwise the machine could not be able to read your card.

Step 2: Select your language. This is the most easiest task to do I think...
This is the easiest task to do I think. Select the language you like.

14
Step 3: Enter your PIN. Enter your pin. ...

Step 4: Transaction Type. ...

You can see now many types of options like Withdraw Money, Deposit Money,
Balance Enquiry, Bill Pay etc. For withdrawal cash you have to chose Withdraw
Money option.

Step 5: Account Type. ...

15
ATM screen will show various types of account. Select your account type that may be
saving or current etc.

Step 6: Enter Amount. ...

It is also a easy task. Chose the amount you want to withdrawal. But make sure that
the amount you are entering is not more than your main balance.And press correct
option.

Step 7: Take Your Money. ...

Now comes the most interesting part. The money comes from the cash
dispenser machine. Take your money before 30 second.

Step 8: Another Transaction:If you want another transaction, chose that option.

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CHAPTER-6 Top 15 uses of ATM Machine

1. Shopping
Online Shopping has been made simple and easy as many online business owners
now integrate payment options into their websites. With many ATM machine, you
can buy products and items online with ease; you can use it to pay at some retail
shops. The bank’s terms and conditions may be apply; ensure you read their terms and
conditions before you initiate transaction.

2. Recharging airtime on mobile phones and devices

With ATM machine, you can recharge Air Time on your mobile phones and devices.
This is usually done in two ways;
• Virtual Top Up-In virtual top up (VTU), you get phone credits topped up
automatically by increasing the previous credit balance by the amount you requested.
This is available for all MTN, Zain and Glo network subscribers.

3. Quick Teller Option-with quick teller, you can buy airtime, make payment online
and shop online.

4. Buying and transferring airtime to others

You can buy and transfer airtime to your family member, relative or friend through
ATM machine. This is usually easy and possible if you own account with the bank
that owns the ATM machine

5. Cash.Withdrawer
This is the very use of ATM machine everybody knows about. ATM machine
provides 24/7 Cash Withdrawal from your account.-

6. Printing of Mini Statement of your account

With ATM machine, you can print the last eight transactions on own account. This
usually important when you want to get details statement of few last bank transactions
made on your account .

17
7. Intra Bank transfer
The Transfer of money from your account to other account of the same bank using
ATM machine is an intra bank transfer. Intra Bank money Transfer service is usually
free. For example if you are a firstbank account holder; you can transfer money from
your first bank account to another first bank account using ATM machine. This kind
of transaction attracts no charge.

8. Inter Bank transfer

you can also transfer money from your back account to a different bank account using
ATM machine; this is called interbank transfer. Bank charges may be applied.

9. Send or transfer money to your family members, relatives or friends

With ATM Machine, you can send or transfer money to your family members,
relatives and friends. The procedure for doing thing is sometimes found besides on the
ATM Machine terminals. It is very easy and simple. Any average reader who can read
words from screen can do it.

10. Check account balance

Account Balance Enquiry can be done using an ATM machine. This is for all Account
(both savings and current) holders’ nationwide. Though it relatively simpler these
days, by dialing a simple ussd code on mobile phone; your account balance will be
sent to you.

11. Check account number

You can also inquire your bank account number using ATM Machine. If you forget
your bank account number and you are in dare need of it, visit any ATM terminal near
you. However, just like dialing a code on phone to receive your account balance, you
can also dial a code to receive your bank account number on your phone from your
bank

12. Payment for DSTV, ELECTRICITY BILL and other utility Bills
One important use of ATM Machine which people don’t know is the use of ATM
machine to make Bill Payment. You can pay for utility bills like Electricity bill,

18
DSTV & HITV subscription fees and GSM Postpaid bills using ATM machine. With
quick teller option on ATM machines, you can do more than this.

13. Airlines: Payment for Pre-booked Aero Air Tickets and others
you can make payment for pre-booking of Aero Air Tickets and other Airlines using
ATM machine. In situation whereby you are choked up with time for boarding air
ticket from Air travelers’ agents, you can simple pre-book an airline through an ATM
close to you.

14. Card based cash deposit

you can carry out card based cash deposit with your Verve or Naira MasterCard card.
However, you can only deposit into the account(S) link to your debit card. It is not all
ATM machines that serve this purpose.

15. Card less cash deposit

In card less cash deposit, you can deposit cash into account without the use of a debit
card. Again, it is not all ATM machines that serve this purpose.

Firstbank ATM machine is an example of ATM machine that can be use to perform a
cardless cash deposit transactions.

19
CHAPTER-7 PRINCIPLES OF ATM
 ATM - originally designed for WAN communications, but quickly adapted for
LANs as well, ends this historical separation and forms a universal platform
for data communication, In both ATM LAN AND ATM WAN networks the data
transport is achieved via connection-oriented communication paths, which
are set up though high-speed switching systems. These ATM switches
perform the cell routing from the input ports of the switch to the destination
port in real time and in parallel for the ports.
 For data transport ATM uses packets with a fixed length of 53 bytes, the so-
called cells. These cells can be processed significantly faster and more
efficiently in switching systems than data packets of variable length. Because
of the cell structure, a massive parallel architecture of ATM switching systems
is possible. Since all cells have the same length, all data units which wait at
the input ports of a switch for transportation at a given time, can be routed
simultaneously to their destination port.

ATM can handle all of today's data services (telephone, data, video-broadcast
and interactive) in an efficient way.

20
CHAPTER-8 FUNCTION OF ATM

THE BEGINNING – GETTING CASH AT ATMs:

The first ATM cards gave consumers access to their checking, savings, and share
draft accounts only at teller machines owned by their bank, credit union, or savings
and loan. People commonly call this kind of card an ATM card, cash card, or banking
card, or they use the name that their bank, credit union, or regional network has given
to the card.

When “regional ATM networks” were created, they linked together the ATMs of
different institutions and offered consumers access to their money in other
neighborhoods and nearby cities, towns, and states. (A list of many ATM networks
names and where they operate appears near the end of this brochure.) At the same
time, two national networks -Cirrus and plus” - emerged, expanding ATM card access
to cash, first nationwide, then around the world. Currently, these are the only two
brands that offer a full range of ATM services worldwide.

ATM cards provide a convenient way of getting cash, making deposits and transfers,
and verifying account balances. It is also easy to tell where you can use the card by
simply matching the logos on your ATM card with those displayed on the ATM itself.

THE NEXT STEP – PAYING WITH ATM CARDS:

More recently, many ATM cards have been enhanced so that you can shop with the
cards at merchants that sign up with the same networks that give the cards wide
access to ATMs. (A list of many of these shopping networks also appears near the end
of this brochure.) Currently there is only one international service, called Maestro*,
that lets card work at participating merchants both in the United States and in more
than 50 countries.

Grocery stores and gas stations were among the first retailers in the United States to
install the small number pads, also called PIN pads that you may have noticed at the

21
checkout counter or on the gas pump. It is these devices that make shopping with
many ATM cards possible.

THE LATEST NEWS /– SHOPPING WHEREVER SOME MAJOR

CARD BRANDS ARE ACCEPTED:

Another ATM card service makes ATM cards more useful by greatly expanding the
number of retail locations that accept the cards for payment. ATM cards with the logo
of one of two of the major card brands – MasterCard or Visa- can be used to make
purchases anywhere these cards are accepted. Today, these kinds of cards are
accepted at some 3 minion places in the United States and 9 million more

worldwide. Currently, these are the only two major card brands that offer
this service.

ATM ON INTERNET
ATM will become an increasingly important technology not only in corporate
environments but also within the realm of the Internet. Graphics-and video-intensive
applications necessitates higher speeds. By current standards, high -speed refers to
networks that operate at 155Mbps.A typical ATM switch can between 16 and 64
ATM devices. Although a single ATM switch has finite capacity, switches can be
interconnected to form a larger network.

IP address bindingin an ATM network as in technologies, ATM assigns to

each attached computer a physical address that must used when establishing a virtual
circuit .On one hand because an ATM physical address is larger than an IP address.
Thus IP cannot use static address binding for ATM networks ATM hardware does not
support broadcast. Thus IP cannot use conventional ARP to bind addresses on ATM
networks

22
CHPTER-9 LIMITATION OF ATM

1. YOU CAN ONLY SPEND WHAT YOU HAVE:

When you use your ATM card, whether to withdraw cash or make purchases, you
are using your own money that is on deposit at your bank or credit union. Naturally,
you can only use as much money as you have available. If you have an overdraft line
of credit attached to your account and your purchase with the card exceeds the
amount available on deposit, your bank or credit union will charge interest on the
amount you borrow from your overdraft.

2. THERE MAY BE DAILY SPENDING & WITHDRAWAL

LIMITS:

Many banks and credit unions set daily limits on ATM purchases and cash
withdrawals, as a deterrent to the use of stolen or fraudulent cards. Often, these two
limits are different and each may vary widely, from a few hundred dollars a day to the
entire amount available in your account. You should ask your bank or credit union
whether your ATM card will have daily withdrawal and spending limits and, if so,
what they will be.

23
 While limits of this kind may seem like an inconvenience, they are
there to safeguard you and your money from unauthorized use of your account. They
can also serve to govern your daily spending, helping you to be more disciplined in
managing your money and your spending habits.

3. RECORD KEEPING REQUIREMENTS:

ATM cards make it possible to overdraft your bank accounts so they require that you
keep careful record of your spending. With an ATM card it is vital to know what your
checking account* balance is at all times. The overdraft fees associated with bank
accounts are high enough that the consequences of overdrafting even by a small
amount are quite serious.

4. HIDDEN FEES:
Hidden fees seen to be lurking around every corner of the financial world. If you are
not using an ATM that is affillated with your bank or credit union then you will likely
have to pay a fee. Although many banks strive to have conveniently located ATM
machines. Using any ATM machine not associated with your bank can deplete your
bank account balance.

5. LOST OR STOLEN CARDS:

Although there are protections out there for identity theft victims, when an ATM card is
lost or stolen it can spell disaster for the card owner. ATM card fell into the wrong
hands and be used to rob your account or make purchases without your knowledge. A
the if could use your ATM card as a Credit card by forging your signature or online
purchases simply by knowing your card number and expiration date.

6. EASE OF OVERSPENDING:
While ATM cards make shopping simple by boiling the process down to the simple
swipe of a card, they also promote overspending. When you shop with cash you know
instantly where you stand financially and how much money remains with a debt or
ATM card it becomes difficult to monitor how much is being spent and how much
money is left until the dreaded card decline or you are hit with an overdraft charge.

24
CHAPTER-10 ADVANTAGES OF ATM
1. USING YOUR ATM CARD TO SHOP MATCHING THE
LOGOS:
If you have the logo of one of these card brands on your ATM card and want to
use it for shopping, your ATM card basically works like a check. This kind of
card is often called a money card, cash and check card, check card, or debit card,
or it can have a special name given to it by your bank or credit union. Regardless
of its name, this kind of card is still also your ATM card. Typically, this kind of
card does not require the use of a PIN to make a purchase. You may already carry
one of these cards. Look at your card to find out.
Just as the various logos that appear on ATM cards tell you where they can be
used to get cash or make banking can be used to make purchases. Simply match
the logos on the store or at the cash register or just ask whether the store accepts
your ATM card.

2. MAKING A PURCHASE:
Let’s say you have planned to buy a desk lamp. You need all your cash for other
things and don’t have your checkbook with you. At the entrance to the store, you
notice an ATM network logo that matches the logo on you card. You decide to use
your ATM card to pay.
When you present the lamp to the cashier, you will be asked how you would like to
pay for the purchase. You offer your ATM card. The cashier will confirm that your
card is accepted by the store, and if it is, the following will occur:
1. You will be asked to slide your card through a dot that reads the information
contained in the magnetic stripe on the back of your card.
2. The cashier will then enter the amount of the purchase.
3. You will punch in your PIN, or secret code.
4. The cashier will press a key that initiates an automatic phone call to your bank
or credit union. This confirmed, your bank or credit union automatically
deducts the purchase amount from your account, just like a check. You will
receive a receipt of the transaction, if you want one, when the sale is
completed. Make sure you record and subtract this amount from your account
immediately.

25
3. AN ATM CARD WILL BE ACCEPTED FAR MORE READILY
THAN AN OUT-OF-STATE CHECK:
When you use an ATM card to make purchases, its easy to tell where it is accepted
just by matching the logos on your card with those at stores that accepted the cards.
And the number of locations that accept ATM cards is constantly expanding, enabling
you to stop in more and more places without cash and cheque.

4. SMARTER ABOUT ATM CARDS:

As you read this brochure, you’ll gain a better understanding of how to take
advantage of the conveniences and features of shopping with your ATM card. And
you’ll find the information you need to use the new service wisely. If you have one of
the more than 200 minions ATM cards in circulation today in the United States, yo0u
May want to take it out of your wallet and refer to it as you read along.

5. USING AN ATM CARD CAN GIVE YOU THE TOOLS TO BE A

SMARTER MONEY MANAGER:
All ATM card purchases and transactions appear as line items on the monthly account
statement you receive from your bank or credit union. You’ll find the date of
purchases, the transaction total, and the merchant’s name. When combined with the
receipt that accompanies each purchase, these clear and complete records make it
easier to track your spending than when you use cash alone.

6. SMART MONEY MANAGEMENT HABITS:

Your ATM cards can be a useful tool in helping you develop good money
management habits if you follow these five simple steps:
Established a monthly budget.
1. Stick to your spending limits and track your expenses routinely and carefully.
2. Save your sales and ATM receipts and immediate- deduct purchases and other
transactions from your chequebook or your account register. Be sure to note any fees.
3. Promptly balance your chequebook against your monthly account statement, which
lists all of your purchases and fees.

26
4. Use your monthly itemized statement as a systematic way to manage your spending
habits, and determine whether your budget is realistic.
7. ATM CARD PURCHASES CAN OFFER CONVENIENCE
WITHOUT INTEREST CHARGES:
If you use your ATM card to shop, you can get all the convenience of using a card for
purchases, but without being charged interest. However, if you have an ATM card
that’s attached ton a checking account with an overdraft line of credit and you
overdraw your account using the card, your bank or credit union will charge interest
on the amount you overdraw, just as they would with a check. If your overdraft
protection is provided by a link to your savings or other account, you may not incur
interest charges. Check with your bank or credit union.

8. WHETHER YOU USE YOUR PIN OR SIGN A SALES SLIP,

YOU’RE ASSURED CONFIDENTIALITY:

The only information provided to the store by your bank or credit union when you
make a purchase with your ATM card is whether or not the transaction is approved
and the amount of the purchase. The store does not have access to your account
information, address or telephone number, or any other information that may be
printed on your check.

9. WHEN A MAJOR CREDIT CARD LOGO IS ON YOUR ATM

CARD:
If you have an ATM card that also has on it one of two of the major credit card logos
mentioned previously, your purchase will be handled as if you were using a credit
card, except for three important differences:
I. *First, the purchase amount will be deducted automatically from your
account – like when you write a check – rather than being billed to you at the
of the month.
II. Secondly, typically, you’ll pay not interest charges, since you’re using
your own money on deposit, not borrowing it. (However, there may be
other fees associated with using this card, an issue addressed later in
this brochure.)

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 III. Third, you will usually sign for the purchase instead of punching in
your PIN. However, since this is your ATM card, if a store has
installed PIN pads to accept your PIN, and it accepts one of the other
logos on your card, the store clerk may ask to use your PIN instead of
signing.

10. ATM CARDS CAN GIVE YOU MORE CONTROL IF USED

WISELY:
With an ATM card and a PIN – or personal identification number – you can virtually
set your own “branch hours” depositing and withdrawing money from your accounts
whenever you wish at your bank or credit union. What’s more ATM cards already
give you access to your money at ATMs located not only at all of your bank’s
locations, but also at other banks and in stores, airports, office buildings, and street
corners across the United States and worldwide.

11. YOUR ATM CARD IS BECOMING EVEN MORE USEFUL:

But wide access to ATMs is just the beginning. Technology is enabling banks and
credit unions to introduced new services that allow you to pay for things by making
your ATM card work like a check. This latest improvement can offer conveniences
and money management benefits over cash and checks.

12. SO KEEP TRACK OF YOUR SPENDING:

Always make sure to keep your receipts, and record your purchases in your
checkbook immediately to prevent overdrawing your account. It’s important to
remember that regardless of whether you see your PIN or sign your name, all of your
withdrawals and purchases will be automatically deducted from your account.

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 CHAPTER-11 HOW TO GET A BASIC ATM CARD &
ONE YOU CAN USE TO SHOP
1. IF IT’S NOT OFFERED AUTOMATICALLY, YOU CAN
ASK ABOUT IT:

Most banks and credit unions across the country offer ATM cards. They are usually
connected to a checking or share draft account. When you open an account, you may
automatically be given an ATM card. But if you haven’t been offered a card, you can
ask for one.
You may also want to ask about any additional services available on the card. For
example, most ATM cards can be used for cash withdrawals and other transactions at
ATMs in the United States and around the world. Your bank or credit union may offer
with your account the additional service that allows you to see your ATM card to
make purchases by using your PIN or signing a receipt.

2. YOU MAY NEED TO APPLY FOR SOME ATM CARDS:

In the case of an ATM card with a credit card logo on it, your ability to obtain this
card will depend on the practices of the individual bank or credit union. The list below
contains the kinds of things a bank or credit union considers to determine whether you
qualify for this kind of service. You may be required to provide additional
information on an application and undergo a credit check. The length of your
relationship with the bank or credit union
The average balance and status of your account
The number of times per year, if any, you overdraw your account
The number of banking products and services you use
Your credit history

3. COSTS INVOLVED IN USING ATM CARDS

The use of ATM cards naturally involves costs to provide the services. As a result,
there may be fees associated with your use of the card. These vary, depending on your
relationship with the institution and whether you are withdrawing cash or making
purchases.

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If a fee is charged at all, it can vary widely. For example, you could be charged a few
cents, such as a dime, every time you use the card, or you could be charged a flat
monthly fee, such as one dollar per month, or a combination of such fees. In some
cases, fees are waived on the amount you keep on deposit at your bank orcredit union.
But, keep in mind that fees can be higher or lower than those cited here. Check with
your bank or credit union.

4. FEES MUST BE DISCLOSED TO YOU:

Along with knowing your available balance, you should be aware of any charges for
using the card. Fees are established band charged by the banks and credit unions that
issue the ATM cards. If a fee is charged, your bank or credit union must filly detail
these fees when get your card. Every time a fee is charged by the bank or credit union
issuing the card, the feel with appear on your monthly statement.
When an ATM card is used to make purchases, a retailer may add a free to your
purchase total. If this happens, the store is required by law to disclose this to you in a
display at the checkout counter. In this case, the fee is added to your purchase amount,
not listed separately on your statement.
5. QUESTIONS TO ASK WHEN YOU SIGN UP FOR A CARD:
Before you use your ATM card to withdraw cash or shop, you should ask your bank
or credit union about the costs associated with ownership and use of the card. Here are
some questions you might ask:
 What are the monthly or annual fees for this card?
 What are the “per use” fees when using this bank’s or other banks or credit
unions ATMs?
 How can I avoid any of t/hese fees?

6. SAFEGUARD THAT PROTECT YOUR CARD AND ITS USE

Two features can make using ATM cards safer than cash and checks.
First, their use is covered by federal regulations that protect both consumers and the
institutions that issue the cards.
Second, technology protects the information about your account.
It’s smart to be aware of these regulations and protections. Here a brief summary of
the safeguards that come with your ATM card and what you must do to take
advantage of them.

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7. YOU’RE PROTECTED IF YOUR CARD IS LOST OR STOLEN
AND IF SOMEONE USES YOUR CARD FRADULENT.
If you report a lost or stolen ATM card within two business days of discovering the
loss or theft, and report immediately any unauthorized uses of your ATM card that
you find on your monthly statement, your liability is limited by federal regulations to
$50. If you do not report the loss or theft within two days, you could be responsible
for up to$500.
If you suspect that your ATM card has been used fraudulently, you must report it to
your bank or credit union within 60 days of receiving the statement on whichthe
questionable activity appears. If you don’t act promptly, you could be liable for the
full amount that the unauthorized user was able to withdraw.

8. YOU’RE PROTECTED FROM BOOKKEEPING ERRORS:

Federal regulations also protect you against errors that may occur in your bank
account during or as the result of an electronic transfer of funds. Such errors could
include:
 Omission of a transaction on your statement. For example, a deposit you make
at an ATM does not appear on your next statement.
 Incorrect amount deducted from your account. For example, you discover
that a $14.25 purchase that you made last month your ATM card appears on
your ATM card appears on your monthly statement as $142.50.
 Bookkeeping error. You pay for your $36 grocery order with your ATM card
and find that the total amount has been deducted from your account twice.
 Receipt of incorrect amount. You request $100 from your checking account
at an ATM, but receive only $90.
 If you suspect that a mistake has been made in your account, immediately call
the bank or credit union where you have the account. You may be asked to
follow up your phone call with a written report of the suspect error.

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 CHAPTER-12 NATURE OF ATM

1.ATM NETWORKS
In recent years, computer systems have achieved an almost explosive increase
in performance, such that developments in the field of data communications have
been unable to keep up. Where the processor performance and memory capacity of
PCs have grown over the past ten years by a factor of a hundred, transfer speeds in
wide area networks have risen 'only' by a factor of ten, and in LANs they have been
stayed much the same.

ATM is a standard recognized throughout the world, which provides for the
first time a method for universal information exchange, independent of the end-
system and the type of information (data, audio, and video).The architecture of ATM
(53 byte cells) supports the design of massive parallel
Communication architectures and enables the implementation of networks with
transfer rates in the gigabit range. With the high-speed networks, it is possible to send
huge quantities of data generated by the latest applications (video mail, interactive
TV, virtual reality, etc)

ATM is suitable for local area networks as well as wide area networks. The
ability of ATM to emulate traditional LAN and WAN architectures will ensure a
smooth transition from today's computer network infrastructure to ATM-based high-
speed technology.

The intense development efforts being made all major manufacturers of data
communication systems in the area of ATM/B-ISDN are evidence of the strategic
importance to the industry of this new transmission technology. ATM is increasingly
being adopted as the central strategic technology for data communication throughout
the industry today.

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2. ATM - ASYNCHRONOUS TRANSFER MODE:

Asynchronous Transfer Mode is a communication standard that uses a high-

speed form of packet switching network as the transmission media ATM was
developed as a part of the Broad band Integrated Services Digital Network (BISDN).
ATM is intended to utilize the synchronous optical network (SONET).
Conventional electronic switching machines currently utilize a central
processor to establish switching paths and route traffic though a network. ATM
switches, however, will include self-routing procedures where individual cells
containing subscriber data will route their own way through the ATM switching
network in real time using their own address instead of relying on an external process
to establish the switching path (a cell is a short, fixed length packet of data)

3. THE ATM LAYER:

The main task of the ATM layer is to transport the data passed down to it by the
adaptation layer(AAL) to its intended destination .this makes the ATM layer the
transport mechanism in B-ISDN networks, the information in the ATM layer are 53-
byte cells, each of which includes in its cell header a numerical identifier allocating it
to a specific connection .these cell streams are divided in to two logical hierarchies
:Virtual channels and virtual paths. Each cell can be assigned to be a specific path or
channel by reference to their numerical path (VPI,VCI) contained in its header .
VPI/VCI Conversion:
If cells are routed via ATM switches or cross connects ,the VCCI and VPI values
applying up to that point need to converted in to new VPIs or VCIs specifying the
cells new destination .
If ATM layer receives n information unit from the AAL layer above it must generate
an appropriate ATM header .It is a central task of the ATM layer to convert network
addresses in the higher levels into the corresponding VPIs and VCI values, the
number subscribers are accessing the physical medium,the GFC field in an ATM cell
can be used to control cell transfer.

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CHAPTER-13 SCOPE FOR ATM IN INDIA
Mumbai, May 30: “when we saw a man in a dhoti in a remote town in South India
withdraw money from an ATM, tuck it in the folds and ride away on his cycle, we
were truly inspired by the ATM growth in the country.” These were the words with
which ICICI Bank general manager OP Srivastava, described the scope of ATM
growth in India.

The focus in the ‘ATM in India’ conference on Thursday was on increasing the ATM
network in India on a large scale.

Said FSS managing director NagarajMyLandla:”Currently, India is positioned as the

second fastest country in ATM growth. ATMs are growing three times more in off-
site premises compared to on-site premises.” Added Euronet India MD Loney
Antony: “ATM disbursements have overtaken the amount utilized by credit cards in
comparison.”
Other bankers strongly voiced the need for banks to ‘come together’ and form a
consortium of a shared ATM network for the betterment of the entire economy. Citing
valuable points and examples, the financial top brass urged the banking community to
drop the ATM network within the country.
The need of sharing ATMs was highlighted by Global Trust Bank president PC
Narayan. “A shared network will tremendously cut costs within banks,” he said,
adding that there was no need for a concentration of ATMs in one area, when all the
work could be done by a shared ATM network.
Furthermore, Mr. Narayan said that between the banks who have a shared network,
there must be equal winnings for all. “Banks must also have an equal platform on the
tech front, while the service provider must have a disaster recovery program,” he
added.
UTI Bank senior VP HemantKaul felt that the days of viewing ATM as a propreitory
tool was over. “Banks must generate revenue from ATMs and for this to happen, a
collective effort must be made,” he said.He added, “Revenues can also be generated
by displaying advertisements on the ATM screen or around it, although currently,
there is a restriction in that area.”

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CHAPTER-14 STRATEGIC TIE-UPs FOR ATM

They have also tied up with western railway (Mumbai),central railways (Mumbai)
pantaloon , HPCL, and BPCL for setting up ATMs at their location .
Almost all cost related to setting up and maintenance of an atm network is fixed.
Thus, the challenges for the bank have been to migrate customers to this channel and
develop new stream of revenues from this channel, in order to make the channel
viable. The bank have achieved tremendous success in this regard. We have been able
to migrate about 90% of all cash disbursement transaction to axis bank ATMs.

To Generate Direct Revenue from the ATM Channel, The

bank has adopted 2 Strategies:

1. ATM sharing with other banks

2. New functionalities such as mobile airtime refill, bill payment & mutual fund
sales through which axis banks eams a commission.
The bank has also set up ATM galleries at 3 location. Each of gallery has 2ATMs for
the convenience of the customers, information kiosk, a card operated touch screen
internet kiosk, though which the customers can access their iconnect account with
bank and perform their banking transaction such as fund transfer, bill payment,
balance enquiry, etc. a bill payment kiosk has also been set up this gallery.

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Limitation of Demonetization on ATM Center

The early hours of Monday to take stock of the government’s demonetisation scheme
that is aimed at draining illegal cash from the economy.
The move – under which the Centre has withdrawn old Rs 500 and Rs 1000 notes –
has sparked chaos and confusion across the country with millions of consumers
queued outside banks and ATMs.
After the PM’s meeting late Sunday, economic affairs secretary Shaktikanta Das in a
press conference on Monday talked in detail about the changes in cash withdrawal
norms. Below are the 10 key points:
1) ATMs will start dispensing new Rs 2,000 notes from Monday or Tuesday
2) There will be separate queues at banks for those who want to deposit and those who
want to exchange cash
3) Daily cash withdrawal limit abolished, weekly limit up to Rs 24,000 vgig I
4) Micro-ATMs will be introduced that will dispense cash on credit or debit cards
5) ATMs that have been re-calibrated to dispense new currency will have a daily
withdrawal limit of Rs 2,500
6) Businesses with current accounts active for more than three months can withdraw
up to Rs 50,000 a day
7) Banking correspondents will be allowed multiple withdrawals a day with an upper
limit of Rs 50,000 per transaction
8) Old notes will continue to be accepted at pharmacies, airports, petrol pumps,
railway stations, toll booths until November 24
9) Special task force will be set up to re-calibrate India’s 220,000-strong ATM
network
10) Daily cash exchange limit has been stretched to Rs 4,500 from Rs

36
CASE STUDY
INTRODUCTION TO ICICIBANK - October 12th, 2010
ICICI Bank is India's second-largest bank with total assets of about Rs.1,67,659 crore
at March 31, 2005 and profit after tax of Rs. 2,005 crore for the year ended March 31,
2005 (Rs. 1,637 crore in fiscal 2004). ICICI Bank has a network of about 560
branches and extension counters and over 1,900 ATMs. ICICI Bank offers a wide
range of banking products and financial services to corporate and retail customers
through a variety of delivery channels and through its specialized subsidiaries and
affiliates in the areas of investment banking, life and non-life insurance, venture
capital and asset management.

ICICI Bank set up its international banking group in fiscal 2002 to cater to the cross
border needs of clients and leverage on its domestic banking strengths to offer
products internationally. ICICI Bank currently has subsidiaries in the United
Kingdom and Canada, branches in Singapore and Bahrain and representative offices
in the United States, China, United Arab Emirates, Bangladesh and South Africa.

ICICI Bank's equity shares are listed in India on the Stock Exchange, Mumbai and the
National Stock Exchange of India Limited and its American Depositary Receipts
(ADRs) are listed on the New York Stock Exchange (NYSE).
As required by the stock exchanges, ICICI Bank has formulated a Code of Business
Conduct and Ethics for its directors and employees.

The principal objective was to create a development financial institution for providing
medium-term and long-term project financing to Indian businesses. In the 1990s,
ICICI transformed its business from a development financial institution offering only
project finance to a diversified financial services group offering a wide variety of
products and services, both directly and through a number of subsidiaries and
affiliates like ICICI Bank. In 1999, ICICI become the first Indian company and the
first bank or financial institution from non-Japan Asia to be listed on the NYSE.

37
ATM SERVICE CHARGE IN ICICI BANK

38
FINDINGS AND CONCLUSION

This project was a great experience for me and I really learnt a lot of things from this
project. This project gave us the knowledge and information about ATM machines,
banks offering ATM services and also about the people and their attitudes and
perceptions towards ATMs.
I have found,
People want the ATM centers to be very close to their houses or place of work.
People want that they should not be made to wait in queues in front of ATM centers.

If possible the banks should improve the software they use and reduce the time
required by the customers.
ATM centers do not provide additional services like cash deposits, cheques deposits,
bill payments, etc, at all its centers, which many people want but they don’t get it and
leads to their dissatisfaction and wherever it is available it is charged.
I have also found in this survey that many of the respondents felt that they were
feeling secured using the ATM card, services and this has led to increased satisfaction
level of these respondents which is a good sign.

I also found from this survey that the almost 70% people are satisfied with the number
and location of the ATM centers. But they still insisted that the number should be
increased to give enhanced service and satisfaction to its customers.

People were happy to say that the ATM centers provides the currency in the
denomination they want and this was as good as dealing with the cashier of the bank
where you can tell him which denomination you want.

Another good finding from this survey was that the ATM centers of bank rarely run
out of cash even though it is one of the largest used ATM centers. About 49% of the
respondents said that it never runs out of cash.

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RECOMMENDATIONS

The findings and the conclusions reveal that there is a lot of changes which can be
brought about to improve the perception and satisfaction of the customers towards
banks ATM centers.

I recommend that,

Bank should increase the number of ATM centers and at strategic positions.

Software used by the bank should be updated and fast so that people are not made to
wait in the queue.

Bank can bring all its services on the ATM machines.

Facilities like cash deposit should also start at the ATM centers.

To increase the customer base and the customer satisfaction the ATM facility should
be made as secured and safe as possible. ICICI ATM is one of the safest but still there
is scope for improvement.

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 BIBILIOGRAPHY

BOOK REFERENCES
Innovation in banking & insurance
Financial services management – DIPAK ABHYANKAR

NEWSPAPER
TIMES OF INDIA
DNA (DAILY NEWS ANALYSIS)

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 WEBILIOGRAPHY:

1. http://www.icicibank.com
2. http://inventors.about.com
3. http://www.techmall.com
4. http://www.swadhan.com
5. http://www.dhanbank.com
6. http://www.axisbank.com

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