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ATM processing is a multi-step action that takes only a few seconds and involves the machine checking if the cardholder has enough funds to withdraw money, deposit funds, or check their bank balance. The machine contacts the bank to verify the account and if there are sufficient funds, the machine delivers the money to the cardholder.
When an automated teller machine (ATM) works with a network of banks to approve a financial transaction, this is called ATM processing. It’s a multi-step action that only takes a few seconds. By using phone lines and bank account records, the machine knows if the cardholder has the funds to withdraw money from an account. Processing not only means withdrawing money, but it is also used to check bank balance and deposit funds.
ATM processing during a withdrawal begins at a personal ATM when a cardholder inserts a bank card and enters that card’s secret code. The code gives the machine permission to start processing this card. The machine is already connected to a working phone line and dials a specific toll free number that gives you access to your alliance ATM. The machine then provides its terminal identification number, so the network knows the location of the machine.
The bank is then contacted during ATM processing. All banks have a special line, much like the Internet, that runs through the phone system and allows ATMs to access select account information. With the card and its corresponding secret code, the bank will verify that specific account to inspect its funds.
The bank reviews the cardholder’s account to make sure there is enough money to cover the requested ATM withdrawal, including ATM fees. If the account is deleted, the bank sends a message back to the teller during this stage of ATM processing. This message authorizes the machine to deliver the money to the cardholder. Surprisingly, this process normally takes less than a minute, usually just a matter of seconds. Many years ago, when online technology was still crude, processing took much longer, but now it’s almost instant.
ATM processing is most commonly associated with making withdrawals, but the teller may perform other tasks as well. Machines associated with the cardholder’s bank generally accept deposits. These work in reverse of withdrawals, taking checks and telling the bank to add that specified amount to the cardholder’s account. Another technique that requires processing is checking an account balance. This can typically be done at any ATM and follows the same processing guidelines, but dispenses an account balance on the receipt instead of giving the operator cash.
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