Starting an ATM business can give you a way to make some passive income based off transactions users make. For your business to work, you'll need to carefully select the right ATM processor. This part of the ATM ecosystem serves as the important link between your machine and the banking networks so that users can deposit and withdraw funds. When looking for an ATM processor for your business, you have several considerations when it comes to costs, benefits, ease of ATM management and contract terms.
Understanding the ATM Business
Running an ATM business requires purchasing one or more ATM machines, finding locations for them and choosing an ATM processing company. Your ATM gets programmed to specifically work with your chosen ATM processor and banking networks. Money is then loaded so that the machine is ready for use.
When customers complete transactions, they usually pay a surcharge fee, of which you'll receive at least part as the ATM's owner. The fee usually also gets split with the ATM processor and the owner of the venue where you install the machine.
Considering ATM Processing Companies
Some factors to consider to find the right ATM processor for your business include:
- ATM equipment selection: You can usually buy compatible used or new ATMs from any reputable source. However, ATM processing companies often sell or lease machines for convenience. If you want the most compatibility and support, you may find it useful to choose an ATM processor that can provide the necessary equipment.
- Banking network support: Transactions can happen through major banking networks such as Star, Pulse, Visa and Mastercard. Looking for an ATM processor that supports all or most of the popular networks across the country can result in more transactions and thus more earnings for your business.
- Customer support: You should consider both the initial support for setting up your ATM and ongoing support services. Unless you're savvy with programming and repairing ATMs, check out ATM processing companies that include all setup services and offer around-the-clock support so that you can keep your system working for users and maximize your profits. Also consider whether you have an easy way to monitor the machine, such as through the processor's mobile app.
- Vaulting preference: ATM processing companies often offer to deposit your ATM's vault cash for you for free or for an additional fee. Consider if you prefer these conveniences over doing the vaulting yourself or if you prefer compensating the venue owner for helping with vaulting.
- Initial costs: When starting an ATM business, you have the initial cost of the machine itself, the installation and the setup with your ATM processing company. Some ATM processors will set up your machine for free but may charge a fee for installing it at the location. Compare the prices of ATM units along with these setup and installation fees to find what's most affordable for your business.
- Earnings potential: You get to set the surcharge for users since you're the ATM's owner. However, your profits will ultimately depend on how much of a cut the venue owner and ATM processor get as well as any additional deductions the ATM processor requires. Search around since some processors, like ATM Experts, advertise no deductions from ATM surcharges.
- ATM processing agreement: An ATM processor may lock you into a contract for a period of a year or longer. If you break the contract, you can expect to pay fees. The contract can also dictate terms about the machine's relocation, ban the installation of an ATM nearby and explain availability and downtime. Carefully read the ATM processing agreement to look for any hidden fees or terms that don't fit your business needs.
Selecting Your Business's ATM Processor
When choosing an ATM processor, look for the companies that offer the most support, reliability, earnings potential and flexibility. For example, you might find an inclusive ATM processor that can provide the equipment, do all the installation and setup and provide ongoing support as a convenient option.
If you plan to operate multiple ATMs, pay close attention to any contract terms that restrict where you can install them and how many ATMs you can have. You'll also want to read reviews about the processing company to make sure there are no indications of poor service or frequent downtime.
- Forbes: Starting a Passive ATM Business
- Prineta: ATM Transaction Processing Services
- National ATM Wholesale: FAQ: How Does ATM Transaction Processing Work?
- ATM Experts: ATM Processing & ATM Deposit Processing
- ATM Depot: The Processing Agreement
- Connect ATM: Buying ATM Machines (The Definitive Guide)
- ATM Experts: ATM Installation - ATM Install
- When shopping for an ATM Machine expect to pay $1800 - $3000 for a good free standing ATM machine.
- When shopping for ATM Processing look for a deal where you get at least 100% of the surcharge and if you have or expect high volume you can negotiate for a little of the "back end" of the deal (maybe an extra $0.10 - $.20).
- Try not to sign an agreement for longer than 2 - 3 years.
- Ask for references of other ATM customers and CALL them.
- Check their 24/7 tech support claims.
- Ask how ATM discrepancies or chargeback's are handled (a good ATM processor will handle them for you).
- Ask what if any fees are required to get started (sign up fee, application fee, rebates, etc.)
- Watch out for hidden fees, bait and switch, etc.
- Read agreements and make sure withdrawn funds are deposited daily (business days).
- Watch out for bait and switch programs
- Watch out for deals to good to be true
- watch out for fly by night organizations who take deposits or application fees and never deliver.
Ashley Donohoe started writing professionally about business topics in 2010. Having eight years experience running all aspects of her small business, she is knowledgeable about the daily issues and decisions that business owners face. She also has earned a Master of Business Administration degree with a leadership and strategy concentration from Western Governors University. Some other places featuring her business writing include JobHero, LoveToKnow, PocketSense, Chron and Study.com.