Make Money With ATM Machines - How to Choose an ATM Company
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ATM machines have come way down in price since first being introduced to the retail segment in the early 90's.
With advances in technology and the number of really good machines still in service we see many used machines for sale on the internet including auction sites. I urge you to beware of any used machine unless you know exactly where it came from, when it was processing last and who serviced it. Many of these used machines we see for sale are not 3DES (Triple DES) compliant, nor do they have keys or management passwords.3DES is an encryption process in the key pad and firmware that protects the consumers PIN number from being stolen when the ATM is dialing the Processor and requesting a transaction. 3DES became a requirement several years ago so we are seeing older machines for sale that are very cheap. These ATMs are just boat anchors or require expensive upgrades.
If you see any ATM machines for sale that are less than $1,000 used be very wary. My advice is NOT to purchase a used ATM unless it is from a reputable company and includes a warranty. I strongly recommend staying away from ATM machines sold by private parties or individuals unless you are very familiar with the brand, model, condition and compliant status of that model.
You can get new ATM's for about $2,000 (as of this article writing) and several refurbished 3DES compliant ATM's for $1,000 and up which should include a parts and labor warranty.
Once you purchase an ATM Machine you still need ATM processing. Look for an ATM company that specializes in ATM processing (I suggest you Google the words "ATM Processing" or check out the author comment links below).
A reputable ATM company should offer ATM's with or without processing. They would also offer ATM processing only if you already have an ATM Machine. If you have a working ATM Machine and know all the passwords and have all the keys a good company should be able to simply re-program your ATM Machine onto their ATM processing platform. To find out if an ATM machine you're considering purchasing is compliant we recommended calling some ATM processing Companies.
A Reputable company will typically require a processing agreement to protect you and them legally as required by sponsoring banks and networks. These agreements are typically 3- 5 years but there are several companies that negotiate fewer years and some that offer just a 2 year agreement with no sign up fee. We know of a few ATM companies that have an 84 month term (that's 7 years). A lot can change in 7 years, I would suggest you keep shopping around if anyone tries to make you sign an agreement longer than 36 months.
ATM Agreements protect you since these companies are moving your funds when one of your customers withdraws cash from your ATM. They move the funds from that ATM customers bank account into your bank account. That should be done nightly except for weekends. Agreements protect the ATM company because many of them don't charge set up fees but incur costs to set up your system so it takes them a few months to a year to recapture those costs.
ATM processing rebates range from 85% of the surcharge plus $0.20 - $0.25 cents (bank-end revenue) up to 100% of the surcharge plus $0.20 cents depending on your ATM machine usage volume. Some ATM companies offer a Tiered rebate which is tied to ATM performance.
Some ATM companies also offer ATM equipment at drastically reduced prices to get you to sign a long term processing agreement. This is typically a loss leader so you only look at how cheap the ATM equipment really is and don't really pay attention to the ATM processing portion of the deal. Watch out for a deal on ATM equipment that seems "to good to be true". This is definitely case of "you get what you pay for".
If the ATM Machine you found is cheaper than everyone else, make sure you read the term of the processing agreement. Most ATM Companies that offer crazy deals on the ATM Machine will make you sign a very long term agreement for ATM processing.
If an ATM company is selling ATMs too cheap or offers a rebate that's too high, then something has to suffer. They can't give ATM machines away and give you a high rebate and give you proper service or stay in business. This is a red flag. Remember, they are handling your money. You want them to make money so they stay in business to handle any issues that arise.
The thing that suffers the most when companies give away to much is usually service. Think about what it would cost you if your were getting $2.10 every time someone used your ATM and 300 people per month used it. That's $630 per month. Now, what if your ATM has a problem and you can't get help, or parts or service for a week or longer -- it's costing you $21 per day --- or over $150 a week.
Look for an ATM company with 24 hour 7 day support with a toll free number. Then, if you're a business that counts on help late evenings or weekends you should test it and call the number at 11pm or on a Sunday and see if they answer the phone.
If the phone is answered live that's a pretty good indication of good service. If it goes to voice mail, leave a message -- tell them you're not a customer yet but you are testing to see how good or fast their 24/7 tech support really is.
If your call goes unanswered or takes hours to be returned, that is probably a sign of a deal to good to be true.
Summary:
- When shopping for an ATM Machine expect to pay $1800 - $3000 for a reliable one.
- When shopping for ATM processing look for a deal where you get at least 100% of the surcharge. And if you have or expect to have high volume negotiate for a little of the "back-end" of the deal (maybe an extra $0.10 - $.20).
- Try not to sign an ATM processing agreement longer than 2 - 3 years.
- Ask for references of other ATM customers and CALL them.
- Check the ATM company tech support claims, is it really 24/7 service
- Ask how ATM discrepancies "chargebacks" 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 the ATM processing agreement and make sure withdrawn funds are deposited daily (business days).
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