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April 12, 2013

Historical Echoes: The Invention of the ATM–A Case of Multiple Independent Discovery?

Amy Farber

Amazingly, something resembling a drive-through automated
bank teller existed back in 1941 (twenty-six years before the invention of the
true ATM, or automated teller machine). It was an ingenious curbside teller’s
window, as described in this October 1941 Popular
article, “Bank
Gives Curb Service to Motorists with Novel ‘Teller-Vision’ Cage
” (p. 63 for
IE7 users).

This “machine” that resembled an automatic teller wasn’t
really automatic—it had a living, red-blooded teller (to forestall robbery,
prepare withdrawals, and push the buttons of a dumbwaiter)—but was indeed
drive-through. However, this doesn’t mark the invention of the ATM, nor does there
seem to be any contiguity of thought between this event and the invention of
the true ATM. Much more sophisticated was an idea for an automated teller by Luther
, a Turkish inventor in New York, who in 1939 developed an idea for
a hole-in-the-wall machine, registering twenty patents. It was determined after
a trial of the machine that there wasn’t enough demand to keep going with the

The modern ATM was invented in two different places (England
and the United States) at roughly the same time, as an
explains. It may be considered a case of multiple independent
discovery or multiple
. Or maybe not, if one considers that the underlying technology
wasn’t the same (radioactive check versus magnetic strip). The British version
was created by John Shepherd-Barron, and it debuted in 1967. This version wasn’t
patented—Shepherd-Barron was advised by his company’s lawyers that revealing
the coding system for PIN numbers, a requirement for the patent, would’ve
allowed criminals to hack it.

A self-described geek blogger named Michael Breaux has posted
a short video about
the rolling out of the first U.S. ATM in Rockville Center, Long Island, in 1969.
The video doesn’t mention the British version, only the U.S. version and its
co-patentee Don Wetzel (the other two were Tom Barnes and George Chastain,
both engineers), a Docutel employee formerly
of IBM.

The story of the Don Wetzel’s invention of the ATM has been
captured in an exciting, very thorough 1995 interview conducted
by Dr. David K. Allison, curator at the National Museum of American History of
the Smithsonian. From this interview, we’re enlightened about the many
decisions surrounding this invention. One of the most interesting points is
that the developers did research to determine the degree of need for such an
invention well before they tackled its technical aspects:

David: By experience, you mean that you approached this, as you
describe it, really from a functional perspective and not from a technical
perspective at all. Do I understand that correctly?

Don: That’s correct.

David: That you sat down with your planners and looked at the market
structure, the functionality. At what point did you begin looking at technical
issues? When did that part of the discussion come in?

Don: Once we determined that the
marketplace was large enough to warrant us getting into that market with this
machine, then we got down to “well, what kind of machine should this be,
and how will it work?” And that posed several problems for us.

Nowhere in the interview is there mention of any knowledge
of the ATM’s appearance in England two years earlier. So, it’s difficult to
determine if and to what extent there was any knowledge of the English version,
although the Wikipedia
ATM entry
intimates otherwise: “After looking first hand at the experiences
in Europe, in 1968 the networked ATM was pioneered in the U.S., in Dallas,
Texas, by Donald Wetzel.” There’s no suggestion in the interview that there was
any race or extreme competition going on, as compared with today’s giant tech
companies. Although both Wetzel and Shepherd-Barron invented different ATMs in
the sense of “cash dispensers,” it was Wetzel’s group that soon developed the
networked ATM (the ATM “talks” to a person’s bank account in real time). Read
the interview to find out about Don’s adventures with encryption,
mini-computers, and magnetic tape.

The views expressed in this post are those of the author and do not necessarily reflect the position of the Federal Reserve Bank of New York or the Federal Reserve System. Any errors or omissions are the responsibility of the author.

Amy Farber is a research librarian in the Federal Reserve
Bank of New York’s Research and Statistics Group.


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Some additional information on this subject can be found at the following two links: and

May I suggest you look at material that is actually supported by contemporary documentry evidence rather than using unsubstantiated websites in the internet. Your story fails in a number of ways. For instance, there is no actual evidence that Simjian worked on the Bankograph before the mid 1950s and his first patent on it dates from 1959 (the 1939 is a typo the MIT refuses to change). There were three (not one) independent British deployments in 1967 (De La Rue – Barclays – as you point out; Chubb – Smith Industries – Westminster Bank; Midland – Burroughs – Speytec). Also in 1967 Asea-Metior and the Swedish savings banks deployed another machine through an independent effort (later branded Bankomat). As further read I suggest Cash Box: The Invention and Globalization of the ATM [Hardcover] Tom R. Harper (Author), Bernardo Batiz-Lazo (Author) But happy to point you to more authoritative material.

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