How To Start An ATM Business: Is It Still Viable In 2022?

ATMs can be found almost anywhere.

That’s because they provide a convenient and quick solution when you require cash in a hurry.

You probably know that most of those ATMs are owned by ordinary folks. 

If you’d like to be one of them, I’ll teach you how to start an ATM business these days. 

I’m not referring to ATMs that are visibly linked with a large bank or financial institution when I say ATM business.

I’m referring to ATMs found at convenience stores or petrol stations that aren’t plastered with giant bank logos.

These “independent” ATMs make up a significant portion of the ATM business. 

Independent ATMs account for 278,394 of the 470,135 ATMs in the United States.

This equates to 59.2% of the market share.

Evidently, there is a large market for independent ATM operators, making it a profitable business venture.

So, what’s the best way to get started in this industry?

It’s actually relatively simple, and I’ll help you through the process.

how to start an atm business

How Can You Make Money As An ATM Business Owner? 

An ATM owner’s average fee is roughly $3.

This fee is typically split between the ATM owner and the owner of the establishment where the ATM is located.

The average transaction split paid to location owners is between $0.50 and $1.00.

ATM owners can also profit from interchange fees, ranging from $0.10 to $0.20 per transaction on average.

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How To Start An ATM Business – Necessary Credentials

Although a business degree is not required to start an ATM firm, specific skills and experiences would be beneficial.

Repair and Troubleshooting Skills 

An ATM owner with some basic troubleshooting and repair abilities can keep the devices running.

An owner who can perform specific maintenance and repairs themselves will save money by hiring a professional regularly. 

A Knowledge of Your Locale 

An ATM owner who is familiar with a particular area can easily spot good locations that are likely to have a high amount of ATM usage.

Examples of suitable locations are tourist areas, shopping centers, and gas stations. These spots get high foot traffic.

Solid Negotiation Abilities 

Negotiation experience can aid a business owner in reaching deals with venue owners.

Technological Background 

A business owner with technological expertise will be able to better understand, use, and market their ATMs to venue owners.

Ease With Networking 

Establishing partnerships with venue owners is a crucial aspect of operating an ATM business.

It will be advantageous if you have strong interpersonal skills and strong networking abilities.

Expertise in Security 

Working in or receiving training in the security industry is advantageous.

Knowing and adhering to security best practices reduces the likelihood of an ATM owner being robbed while maintaining the machines.

Meticulous About Details 

Meticulous attention to detail is essential when dealing with enormous sums of money like those needed to replenish ATMs.

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How To Start An ATM Business – Steps To Set Up

Steps To Set Up An ATM Business 

1. Handle the paperwork. 

The first thing to do when launching an ATM business is to complete the necessary paperwork.

Paperwork and meeting legal requirements encompass most of the hard work in this venture.

To acquire your machine, you’ll need to fill out the following papers and documents. 

This establishes your eligibility to operate an ATM and aids in your success.

This procedure is intended to make buying and using an ATM as simple as possible.

Your ATM processor will mandate an equipment order form.

This is where you select the equipment you want and indicate whether the installation will be handled by you or someone else.

Most of the time, professional installation is the way to go.

You’ll also need to keep track of your charges and the denominations that your ATM will accept.

Then there’s the ACH form, which allows you to deposit your earnings into your bank account.

To establish your identification and pass a background check, you’ll need your driver’s license.

If you’ve been convicted of a criminal or financial crime, you can’t operate an ATM.

The authenticity of your linked bank account is confirmed by a rejected business check.

To operate an ATM company, the account must be a checking account, not a savings account.

The ATM Operator Agreement and application informs banking partners about who they are working with and assure compliance with all federal rules.

You’ll also need to fill out and submit a W-9 form. 

You’ll need to keep track of your earnings for tax purposes because you’ll be making money from your ATM.

The ATM processing agreement is the final step.

This form outlines your rights and responsibilities as a business entity, as well as those of the ATM processor.

The legal agreement between you and the ATM processor manages your ATM program.

This agreement also guarantees that you will receive your payment on time.

2. Choose your ATM type. 

When it comes to ATM equipment, you have three factors to consider: ATM type, manufacturer and model, and new or refurbished.

There are three types of ATM machines: free-standing, through-the-wall (TTW), and wall mount.

When it comes to positioning, free-standing ATMs give the most excellent options.

They may be put up almost anywhere there is a power outlet.

They have a compact footprint, which is advantageous when working with limited floor space in a business.

Because the interface is locked within the wall extending into the next room, TTW ATMs are bulkier but more secure.

This makes it a little safer to use the machine to replace cash.

Wall-mounted ATMs can be installed on a wall, a table, or a counter.

If you don’t have access to a lot of extra space at your site, this can be useful.

Small companies and low-traffic areas will find this to be a more realistic option.

Hyosung and Genmega are two of the most well-known ATM manufacturers.

Both companies make high-quality, dependable equipment.

Triton and Hantle (Tranax) ATMs are also available from ATM Depot.

These market-leading manufacturers create long-lasting ATM equipment that can last up to ten years.

Naturally, prices will vary depending on the manufacturer, machine type, and features.

You can also choose between buying a new machine or a refurbished one.

New devices are advised for first-time independent ATM deployers (IADs) who are just getting started in the ATM sector.

A new ATM is easier to operate thanks to new technology based on feedback from IADs and users.

On the other hand, purchasing a used ATM may save you money and speed up your ROI and profit.

It’s also a plus for the environment to reuse electrical equipment instead of throwing it away.

3. Secure a location. 

You need to know where you’re going to install an ATM before you even consider ordering one.

Choosing the perfect ATM location requires a lot of thought.

You must think about things like visibility, accessibility, and competition.

When it comes to choosing a location, the first decision you must make is whether you want to:

  • Supply a space you already own 
  • Work with a property owner 
  • Rent your own space 

If you rent or buy your own location, you’ll need to consider that into your running costs.

You might want to alter your strategy accordingly if you want to earn a profit.

Partnering with a site location owner is the same.

ATM businesses aren’t linked to a single location.

However, you’ll want to set up a route of ATMs that are close together so that they’re easy to replenish and service.

Most high-traffic locations are clumped together anyway, especially in cities.

To maximize daily ATM transactions, they should be placed in areas that are open to the public for long hours.

You want to look out for high-traffic areas.

Consider convenience stores, gas stations, bars, and grocery stores. 

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4. Establish your surcharge fee. 

Establish your surcharge fee

Customers or users pay a cost for the service provided by your ATM.

You earn the extra amount for each transaction performed on your ATM. 

Setting your surcharge should be a carefully calculated process.

You want to provide a competitive surcharge while still ensuring that you make the most profit possible. 

The typical ATM surcharge is around $2.50.

That may not seem like much money, but you can adjust the charge amount based on the level of competition in your area.

And you have the option to modify it at any time.

You might want to start with a modest cost to encourage people to use your machine as you get started.

Alternatively, you might increase the surcharge to fulfill your ROI faster and begin earning sooner.

It is entirely up to you as the business owner to make that call. 

You should also examine whether you’ll be sharing any revenue with a third party, such as a site location owner.

If that’s the case, you could opt to impose a larger fee to generate more money after the site location owner’s cut.

5. Find financing if you need it. 

Starting an ATM business can be costly, especially if you don’t have the funds to supply the machines.

Financing might assist with those first initial costs.

A business owner must have strong credit and personally contribute 15-25% of the total start-up expenditures to qualify for a business loan.

6. Hire staff. 

A business owner may be able to service and maintain a smaller network of ATMs.

But in order to boost earnings, you might want to install additional ATMs. 

This is something that hiring employees can help with.

An ATM manager responsible for service and operations earns an average of $85,585 per year.

Depending on your region, salaries might range anywhere between $63,151 and $110,062. 

A company’s budget must include related expenses such as paid time off and worker’s compensation insurance in addition to employee salary.

7. Get business insurance. 

For complete coverage, an ATM company needs various forms of insurance.

There are specific ATM-specific insurance policies available in addition to standard insurance coverage, like: 

  • Commercial property insurance protects the company from damage to the ATM that could occur in the event of a fire.
  • A business-owned vehicle is covered by commercial auto insurance. This protects the company from fees incurred if the vehicle is involved in an accident.
  • General liability insurance protects the company if a vendor or ATM user is injured while using the machine.
  • Transit insurance protects the company from financial losses that may occur while the money is being carried, processed, or stored.
  • Worker’s compensation insurance helps to pay costs such as medical bills and attorney fees. These fees may arise if an employee is hurt on the job.
  • Loss or damage to the ATM and loss or damage to the cash inside the ATM are covered by ATM insurance.

The cost of insurance coverage will be determined by factors such as the business’s ATMs’ value.

The amount of cash on hand also factors into the equation. 

Request quotes from several insurance providers to get an accurate estimate of how much you should budget for insurance. 

Consider the differences in premiums, coverage exclusions, coverage, limits, deductibles, and other critical components of each insurance when comparing estimates.

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A Few Pitfalls To Avoid When Launching An ATM Business 

1. Not investing in new equipment

how to start an atm business - Not investing in new equipment

Purchasing second-hand ATM equipment may appear enticing, but you must be cautious of what you purchase right now.

You should invest in new equipment when establishing an ATM business because EMV rules are now in effect. 

When you purchase new equipment, you will receive a 2-year parts warranty and will be setting your company up for success.

If you buy old equipment, you risk having to do a lot of maintenance and possibly losing sites because of out-of-service equipment.

2. Overlooking EMV

Study up on EMV and make sure you understand which makes/models can be upgraded and how much it will cost.

When EMV is introduced, this will save you time and headaches.

The majority of new machines sold past 2018 are EMV-enabled.

3. Setting your surcharge fees too low

When it comes to extra fees and commissions, be cautious when negotiating with your merchants.

Don’t give too much of your profit margin away. 

You must be familiar with the market and understand what is expected while also being careful not to give up too much.

You will be more satisfied with your revenue in the long term if you establish your margins appropriately right away.

4. Setting up in a suboptimal location 

Make sure your locations aren’t too far off from each other or from your main base.

Make an informed decision on which territory to pursue and do your best to stick to it.

The greater the distance between your locations, the more your time and service charges will be.

A well-knit network of teller machines is thus more desirable to purchasers.

5. Exaggerating your expected cash flow 

There are numerous websites that claim that each ATM may earn you $500 per month or more.

The majority of the time, these projections are way off the mark. 

A more realistic budget is around $250-$300 in earnings on the high end. $150-$200 is a solid bet on the low end.

Make some calls, chat to merchants, and be conservative with your earning projections in the ATM business.

6. Miscalculating the required capital 

To supply the machines on a rotating basis, you’ll need cash – a lot of it.

You should budget at least $2,000 per terminal per week.

If you want to deploy ten terminals, you’ll need at least $20k in working capital, if not more, to keep the ATMs running.

7. Not having a solid relationship with a bank

how to start an atm business - Not having a solid relationship with a bank

With Operation Choke Point and other concerns in the mix, you should check with your local bank to see whether they can support your ATM operation.

At this time, some banks will not support the ATM business, so make sure yours does. 

8. Not setting up contracts with merchants

You should make every effort to secure written agreements with your merchants if you wish to sell or defend your ATM locations.

Many operators operate their ATM business without contracts, and when it comes time to sell, the value is diminished. 

You’ll also have nothing to fall back on if the retailers decide to remove your ATM or allow a competitor in.

It would be best to protect yourself and get some contracts signed! 

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Final Thoughts 

The most fantastic aspect of having an ATM business is that you have complete control over the majority of the factors that influence your success.

You choose:

  • Where you want to place your machines 
  • How much you’re willing to spend on equipment and staff
  • The amount of your transaction fees
  • Who you want to work with 

ATMs are growing more popular than ever as Americans place a greater emphasis on convenience and accessibility. 

This is especially true when it comes to banking.

You may capitalize on this trend by launching an ATM business and assisting business owners by providing ATM services on their premises. 

Operating an ATM business provides you with a great deal of flexibility in terms of operation hours and locations.

You could even run it as a side business.

Because of it, you might gain that financial independence you’ve always wanted because of that passive income.

Disclosure:  this article might contain links to the resources discussed.
Some of the links are affiliate links, meaning that I will make a small commission if you purchase a product or service by using the link. You get the same price whether you use our special link or not, and sometimes I’m able to get you an even better deal through my relationships!  More info in my privacy policy.

Brooks Conkle

Brooks Conkle

Brooks is an Entrepreneur, Sponge, Father, Husband, & Follower of the Golden Rule. He has over 15 years of experience as an entrepreneur after graduating with a BSBA in Finance from Auburn University. He’s addicted to growing new business ideas and any food that includes chocolate and peanut butter. Brooks is a firm believer in creating multiple streams of income and creates content here on BrooksConkle.com to help other hustlers in the areas of marketing, online business, personal finance, and real estate. 

Brooks Conkle

About Me

With 15 years of experience as an entrepreneur, I help hustlers build multiple income streams so that they can control their financial future and create a flexible lifestyle.

Disclosure:  Our articles contain affiliate links, meaning that we make a small commission if you make a purchase through the link. Sometimes we're able to get you an even better deal through our relationships!  More info in the privacy policy.

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