Starting an ATM business should not be an expensive proposition like it might be for some franchises. The sample fees for starting one ATM are given below:
ATM Machine cost (indoor) | $2,100 |
Programming for the business | $49 |
Shipping | $249 |
Merchant Application | $99 |
Stock Cash in ATM | $1,500 |
Estimated total | $4,000 |
These fees vary depending on where you get the ATM from, whether you buy it used or new from a manufacturer, etc.
This does not include other costs that you are going to incur like rent for the location, the cost of incorporating a Limited Liability Company (LLC), and other administrative and legal fees that are associated.
You have a lot of options when it comes to choosing ATM equipment. First, you must decide the ATM type: free-standing, through-the-wall (TTW), or wall mount.
Free-standing ATMs offer the most flexibility when it comes to placement. They can be installed anywhere there is a power source. They have a small footprint which is helpful when planning around available floor space in a store. These cost between $2000 – $3000.
TTW ATMs are bulkier but more secure because the interface, the back of the machine, is secured within the wall extending into the next room. This can make accessing the machine to replace currency safer. They’re more expensive as they have to weather the elements of nature and be sturdier to remain protected from theft. As such, they are closer to $10,000 in cost.
Wall mount ATMs can be mounted to a wall, table, or countertop. This can be convenient if your location doesn’t have a lot of extra space available. This is also a more practical choice for small businesses and low-traffic locations.
Look to place your business in high-traffic retail environments. Some examples would be convenience stores and markets, bars, concert halls, transportation and tourism hubs, etc. The idea is to look for foot traffic that would attract transactions. These are locations that anyone would want to target and might, thus, be harder to get a headstart in but will turn a bigger profit.
The more people who pass and see your ATM regularly, the more business you’re likely to get. High traffic areas also provide a level of security and comfort and isolated machines away from security cameras or the public eye present an increased risk of vandalism and theft.
You should consider whether or not you are going to own the location. Buying a location in a commercial market might be expensive and drive your business into the ground if you do not make expected profits, but people might not want to rent out only a small portion of their land for a standalone ATM when they have bigger stores. If you do partner with a store, make sure it is one that gets high footfall and has a good reputation.
An uncommon thing to do is have a mobile ATM that you can bring to locations like concerts, festivals, etc. Those are times when people need cash very quickly. You can also charge a higher surcharge of $3 – $5 when you look at these locations. Music festivals are also a good venue.
ATMs make money on the surcharge they charge you. Ever been to an ATM and asked to accept a $3 fee to get cash from there? That fee goes to the bank if it is a bank-owned ATM or the business owner if an entrepreneur or such business owns it.
Revenue for an ATM can be calculated using the simple formula of transactions – surcharge. It is imperative to make sure that you adjust your surcharge so that you are not driving people away. After all, no one wants to pay $20 in fees for a $100 withdrawal.
Depending on your ATM’s location, you can make anywhere from $10 – $100 on a given day. The average ATM in a retail location sees about 6 – 10 transactions per day. Assuming you retain $2.50 (after ISO fees) per transaction, you will see between $15 – $25 every day. That translates to $450 – $750 per month.
Outside of the commission a merchant might charge you, there are a few costs you will incur:
As this business is less regulated than franchises are, you are more likely to encounter scams. Therefore, you should do your due diligence before entering this business. One of the common scams in this business is a Ponzi scheme. Some investors in 2009 caught themselves in the middle of this when they invested huge sums into an ATM business. At first, the scammers kept the cash flowing from newer investors who were being recommended the business by people they knew. That is one way in which Ponzi schemes work where someone who is getting “profits” recommends it to other people.
If you do business with a company that promises you a package, you should look over all the legal documents before signing anything or giving anything away. A lot of the time, businesses will promise you a package that includes a location. What they do is sign an agreement with a merchant somewhere with no land being in your name. You end up paying several thousand dollars for machines that go on the market for less than $500.
Another type of common scam is when businesses tout their ATM packages as get-rich-quick schemes. Basically asking you to hand over all of your money to them in return for you to have to put no work into the business, letting them handle everything. Companies like this usually are gone by the time they promise your profit will be in your hand.
Once again, read all the paperwork you sign, look over the prices of things you are sold, do your research, and remember that if something seems too good to be true, it most likely is.
ATMs can be a very profitable business if your location is right and we hope that this gives you an idea of what you need to start an ATM business of your own. If you want to explore other businesses and franchises, look over Vetted Biz.
Looks like your subscription is due. Please renew to keep using our services.
You are going to downgrade your subscription.This action will proceed the difference in cost of plans and reset subscription period after moneyback.
You are going to upgrade your subscription.This action will proceed the difference in cost of plans and reset subscription period after moneyback.
You’re about to cancel your subscription. Please confirm by clicking on the “Cancel Subscription” button below.
Sorry. You must be logged in to view this form.