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How Do Banks Prevent ATMs From Running Out Of Money?

How Do Banks Prevent ATMs From Running Out Of Money?

Automated Teller Machines, also known as ATMs, practically never run out of money for a number of different reasons. In fact, there are only a few possible scenarios which would result in ATM not having enough funds for customer withdrawals. Financial institutions use many mechanisms to ensure ATMs always have sufficient cash to prevent them from running out of money.


ATMs are directly connected to a network which communicates with banks and credit unions when accessing a customer's account. This of course is necessary to verify the customer has funds available with which to withdraw against. The communication is not limited to account inquiries however, and the ATM reports various pieces of information to the company in charge of keeping it stocked with cash.

Each automated teller machine at any given location will have a certain amount of foot traffic and total withdrawals daily and weekly. This information is used to forecast anticipated withdrawals. Subsequently, the amount of cash available in an ATM is the amount expected for withdrawal between scheduled cash deliveries plus an extra 10%. If in the event of higher than expected withdrawals, such as over a holiday weekend, the ATM reports that it is running low then an additional refill can be scheduled. In the unlikely event that an ATM is completely depleted of funds, the machine will no longer function and display "out of order" on the screen.

Theft and Error

Given that an automated teller machine is merely a piece of machinery, it is possible there could be a malfunction causing it to report running out of money or actually run out of money. Every now and then a news report will describe a situation where an ATM "freaks out" and dispenses all of its cash at once. It more likely occurrence is during a customer withdrawal where the ATM miscalculates the amount of funds requested or processes multiple requests in error. This could result in an ATM running out of money were under normal operating conditions this would not be the case.

Not all retail establishments are created equally and sometimes ATMs are hacked or legitimate currency is replace with counterfeit bills. Much like the malfunctioning example, this is an incredibly rare occurrence and tampering with the money supply is considered a federal offense which leads to rapid investigation and prosecution. Individuals who have their ATM card skimmed and PIN stolen may try to withdrawal funds from an account with a zero balance. In this event it may be perceived that the ATM has run out of money when in reality funds have been stolen from the customer's account.

Just In Case...

In the event that an ATM runs out of money, a customer can take the receipt to their local bank branch. Normally within 24 hours the ATM will be audited and the customer given their funds. This is only in the case of bank error were funds were either not disbursed or the total amount dispersed was incorrect. Most ATMs however, have regular use with consistent withdrawals and in most circumstances should be prevented from running out of money altogether.

Image by: Thomas Hawk