User:Metvishwa/sandbox

= ATM Payment Network Architecture =

1) Understanding the ATM network
Figure-1 below depicts a typical Bank ATM network. There are different entities which come in to play to form an end to end ATM Payment network, such entities are:


 * Issuer : Institution owning card
 * Acquirer : Institution owning device
 * Forwarder: payment Network forwarding transactions

2) Classification of transactions
Usage of a particular bank (let say bank ABC) ATM card on ATM devices owned by same/other banks could have following combinations:


 * ONUS: Bank ABC issued ATM card is used at Bank ABC ATMs
 * Remote Onus: Bank ABC Customer on Bank XYZ or any other banks’ ATM (Issuer transactions)
 * Off-us or Not Onus: other Bank customers on Bank ABC ATM (Acquirer transactions)

A bank can be Acquirer for a few networks and issuer for some networks

An ATM can support following type of transactions:


 * Cash Withdrawal

- Cash Withdrawal (CASA) - Fast Cash (CASA) - Multi currency cash withdrawal (CASA)


 * Cash and Cheque Deposit

– Online Cash Deposit to Account (CASA) – Cash Deposit via Envelope (CASA) – Cheque deposit


 * Inquiry

– CASA Balance Enquiry – Mini statement


 * Requests

– Cheque book – Statement


 * Funds Transfer

- FT to Own Account (CASA to CASA) - FT within Bank Accounts (CASA to CASA) - FT to Visa debit or credit card (From CASA) - External FT over ATM shared Network (from CASA)

3) ATM Card and Tracks
An ATM card typically stores information on magnetic strip at the back of the card. following table gives a view of typical information captured on magnetic strip

4) ISO 8583 Overview
All ATM payments messages across world follows ISO8583 standards to speak a common language and resolve interoperability issues in Global ATM networks.

An ISO 8583 message is made of following parts:


 * MTI – Message type indication
 * Bitmap – Indicating which data elements are present
 * Data elements

Some key data elements of the ISO 8583 message are

– Institutions : Acquirer, Forwarder and Issuer

– Card and Pin data

– Terminal information : Card acceptor terminal ID, Card acceptor Terminal code, Card acceptor name

– Transaction data : Transaction Type, Amount & currency, transaction date and time,

– Reconciliation and Settlement data :Settlement and PAN Amounts, Currencies, Settlement date time, System trace audit number, Retrieval reference number

ISO 8583 - MTI illustration

Illustration (1987) for financial messages


 * 0200 :Financial request
 * 0210: Response for financial request
 * 0220 : Financial advice
 * 0230 : Response for financial advice
 * 0221 : Financial Advice repeat

Following diagram shows a typical ISO8583 Message flow between ATM – Switch – Bank Host systems

Here, ATM transaction initiator is able to reach Bank Host (Step 1, 2 and 3)but reverse flow fails as Payment Switch can not contact ATM. In this case, Payment switch or ATM Controller issues Authorization reversal messages to Bank host (Step 5) and Bank host confirms the same (Step 6)



ISO 8583 - Data Elements

    Processing code:

The processing code consists of six digits of the form TXFATA

a) TX: Transaction       b)  FA From account type, TA to account type c) Common transaction codes are        * Purchase 00        * Withdrawal 01        * Refund 21        * Deposit 20        * Transfer 40

d) Common Account types are       * 10 : savings        * 20 : current        * 30 : credit

e) Example : funds transfer from Savings to credit account will have processing code as 401030

5) Illustration of ATM Cash Withdrawal across geography
ATM transactions could be of Single messaging system or dual messaging systems types.

In a single messaging system every online transaction settles itself.

In a dual messaging system, transactions are broken in two parts:


 * Online transaction will earmark funds from account as part of approval
 * Settlement transaction will post the final transaction to account and generate settlement entries.

Consider following scenario,

> an ATM Card holder Sandeep is on a Business visit to Japan

> Sandeep is a customer of Bank ABC in India (Pls refer to Figure-1  above)

> Sandeep has an INR account in India

> Sandeep uses his debit card (Issued by Bank ABC) in Japan to withdraw 1000 Yen from the ATM of Bank XYZ in Japan.

Diagram below shows the ATM transactions originated from Japan