How ATMs Work

The Purpose of an ATM

An Automated Teller Machine (ATM) is used to electronically withdraw money from and deposit it to your bank account. Unlike human bank tellers, an ATM works 24/7, so you can withdraw your funds during an emergency. You can also use an ATM to withdraw money from your debit or credit card accounts (with credit cards, withdrawing money is known as taking a cash advance). ATMs are found not just at banks, but at supermarkets, shopping malls, and outside on city streets. All that is required to use an ATM is a bank-issued ATM card.

How to Use an ATM to Withdraw Money

When you approach an ATM, you must first identify yourself as a legitimate bank customer. You do this by entering your name and Personal Identification Number (PIN), given to you by your bank. You then enter your card, which has a magnetic strip on the back that electronically your account. You then use the ATM's keypad to specify how much money you are withdrawing from your account. After you press "enter," the ATM electronically contacts your bank account and withdraws the amount you specified. Afterward, it vends cash, which you pick up from a drawer at the bottom of the machine. After you collect your cash, be sure you take your ATM card. You can also print a receipt, if you wish.

How to Use an ATM to Deposit Money

To deposit money, you use the same process as you do when withdrawing money. But first, you put your check and deposit slip in a special ATM envelope (which you get at your bank, or beside the ATM machine in a holder). You then insert your ATM card into the ATM, enter your PIN, choose "deposit," and enter how much you are depositing. The ATM will open a deposit slot in which you'll deposit the envelope. After you've submitted your envelope, you remove your ATM card and print out a receipt.