A wallet-sized plastic Automatic Teller Machine (ATM) card linked to your bank account makes financial transactions a breeze by eliminating the waste of writing checks or the dangers of carrying large sums of cash. Also known as a debit card, ATM cards benefit both consumers and the banking institution where they originated.
Benefits for Consumers
Use an ATM card to keep accurate records of banking transactions. Monthly statements, usually available online or printed and mailed, itemize each transaction made with the card. This benefit leads to fewer accidental overdrafts, and provides a visual record of spending habits, unlike using cash. Transactions are processed quickly with an ATM card. Sliding the card is faster than writing a check, more accurate than paying with cash (since change can be miscounted), and makes some transactions quicker. For example, using an ATM card at a gasoline pump eliminates the hassle of standing in line in a convenience store to complete the sale. After a quick swipe and approval, a receipt is often printed at the gas pump for user convenience. ATM cards are usually free, according to Merchant’s State Bank. Unlike checks, many financial institutions do not charge their customers for an ATM card.
Benefits for Businesses
When consumers use ATM cards to pay for purchases, funds are deposited quickly into the business account. In as little as 48 hours, businesses will have access to money from ATM card transactions. Checks can take up to seven days to clear, putting a hold on accessible funds. Business owners pay to offer the convenience of credit card transactions for their customers. For each transaction, a small percentage is paid to the credit card company as a convenience fee. ATM card transactions are a win-win for both the businesses that accept the ATM card and the consumer. When consumers pay retailers with an ATM card, the business owner doesn’t have to pay a fee. And, consumers don’t have to pay interest or annual fees when using an ATM card, like they would with use of a credit card.
Benefits for Travel
When you’re trying to pack light, leave the checkbook and stack of paper money at home. One simple ATM card can pay for purchases with funds directly withdrawn from your checking account. The small card is simple to tuck in a small purse or in a snug pocket. When cash is needed, get a better exchange rate in foreign countries by using an ATM card. Foreign ATM machines offer users access to the wholesale exchange rate, which is often less expensive than paying service fees when exchanging cash or travelers checks in a foreign bank or currency exchange office.