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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.
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 consumers 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
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
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.
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]
Count
Responses
% of cases
34
54
18.7
29.7
34
54
50
27.5
50
42
23.1
42
1.1
180
100
182
ATM centers
24 hours availability of
cash
Other reasons
Total Responses
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.
19%
27%
Other reasons 1%
30%
5. Funds transfer:
Customer can transfer funds from one account to the linked account in the
same branch.
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.
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 todays 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.
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ATM screen will show various types of account. Select your account type that may be
saving or current etc.
Step 8: Another Transaction:If you want another transaction, chose that option.
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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 .
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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.
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and
forms
universal
platform
for
data
transport
is
achieved
via
connection-oriented
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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
checkout counter or on the gas pump. It is these devices that make shopping with
many ATM cards possible.
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
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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.
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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.
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.
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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:
Lets say you have planned to buy a desk lamp. You need all your cash for other
things and dont 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.
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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.
II.
Secondly, typically, youll pay not interest charges, since youre 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
III.
this brochure.)
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.
whenever you wish at your bank or credit union. Whats more ATM cards already give
you access to your money at ATMs located not only at all of your banks locations,
but also at other banks and in stores, airports, office buildings, and street corners
across the United States and worldwide.
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.
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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.
unions ATMs?
How can I avoid any of t/hese fees?
and find that the total amount has been deducted from your account twice.
Receipt of incorrect amount. You request $100 from your checking account
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.
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ATM is a standard recognized throughout the world, which provides for the
first time a method for universal information exchange, independent of the endsystem and the type of information (data, audio, and video).The architecture of ATM
(53 byte cells) supports the design of massive parallel
Communication
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 highspeed 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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29
30
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The early hours of Monday to take stock of the governments 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 PMs 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 Indias 220,000-strong ATM
network
10) Daily cash exchange limit has been stretched to Rs 4,500 from Rs
CASE STUDY
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INTRODUCTION TO ICICIBANK
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.
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QUESTIONARY
34
35
36
5. Have you face any security issues in using ATM service of ICICI
bank
Yes
No
6. Once use ATM you will get message from the bank through?
37
SMS
Call
Only sms
7. Do you get proper & timely message when you withdraw money
from ATM?
Yes
No
38
39
10. To avail ATM service from the bank , do you need to spend more
time in bank?
Yes
No
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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 dont 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.
RECOMMENDATIONS
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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)
WEBILIOGRAPHY:
1.
2.
3.
4.
5.
6.
http://www.icicibank.com
http://inventors.about.com
http://www.techmall.com
http://www.swadhan.com
http://www.dhanbank.com
http://www.axisbank.com
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