As we move closer and closer to a cashless society, Automatic Teller Machines and the use of ATM and debit cards are becoming an everyday routine that many of us no longer recognize.  However, I am certain that most Americans rarely think about just how and ATM machine works, much less how secure their money and transactions are via these hi-tech systems that remove the need for the bank teller and the bank.  I strongly believe that the evaluation of Automated Teller Machines, as well as other financial systems that are now used daily, is important to insure that our account and financial security and privacy are being protected.

• Ease of Usage for Customers - Can ATM's be used by customers with ease?  Is there any trouble or confusion with the basic layout of ATM's?  If there is any complication to the system, how does this effect the security of the system?
• Monitoring of the Money Dispensed -  How does the ATM monitor what bills are dispensed?  Is there a log kept of all transactions and if so, how is this recorded?
• Quality of Bills Dispensed and Accepted - How does the ATM determine that the money people deposit into an account is valid, and not counterfeit?  How does the ATM verify that it does not dispense too many bills or bills that may be stuck together?
• Verification of Funds in Accounts - How does the ATM verify that the customer has the amount requested in his/her account?
• Protection of Account and Customers - How safe is the system?  Are users account protected, and how?  Is the location of the system in a safe and secure environment?

• Ease of Usage for Customers - The standard system is very basic.  The screens are self explanatory and easy for most customers to understand.  On a basic ATM, parts include a card reader, key pad, screen, receipt dispenser, and cash dispenser.  From my own usage, I have never had any trouble understanding how to execute transactions on standard systems, and I think that overall my conclusion is that most ATM user's have no trouble accessing the system functions.

Basic Parts of ATM

• Monitoring of the Money Dispensed - After doing some research, I found that the ATM does monitor and log all of the transactions that are made everyday.  ATM's have an "electric eye" that counts all of the bills dispensed, and also logs this information along with other transactions and data into a "journal".  This record is printed daily and kept in the computer system for two years.  Thus, if a customer has a dispute about a transaction or is the victim of financial fraud or theft, he/she can contact their bank or local ATM machine to review the transactions made on his/her account.

• Quality of Bills Dispensed and Accepted - Through further research, I found that ATM's have a sensor that verifies the thickness of bills.  This technology verifies that money being deposited is real, and also makes sure that it does not give out too much money, by checking that no bills are stuck together prior to dispensing.  Bills that are stuck together, worn, torn, or folded are considered reject bills, and are not accepted or dispensed.  This information is also recorded in the log.

• Verification of Funds in Accounts - The process for verifying that a user has adequate funds is as follows.  "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 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 checking 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 ACHs 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." (How Stuff Works)

 

 
 
• Protection of Account and Customers - ATM's protect customers' accounts by having them enter a PIN number into the machine prior to having access to the account and making any transactions.  Most banks and debit card companies give advice on securing you PIN and selecting a PIN in order to help protect your financial security.  Some tips include - "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. Avoid using birth dates, initials, house numbers or your phone number."
• Additionally, to protect customers, ATM's are usually located in well lit areas or have some type of security camera in the system.  Also, by federal law, ATM receipts only print out the lsat four digits of the customer's account on dispensed receipts for added information security.




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Recommendations

Overall, I think that Automatic Teller Machines are relatively secure machines.  I learned a lot about these systems from this evaluation.  I honestly thought that ATM's were much less secure than the research that I found stated.  I think it would be helpful for banks to distribute facts as I have found to its ATM card holders, just as an additional form of education and awareness to information security.  Additionally, I think informing customers of the importance of PIN security and safety at ATM's would help to secure users and to prevent any vulnerabilities from the system occurring.