Learn About the Risks of Depositing Money at ATMs

Hundred dollar bills emerging from ATM
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Deposits at ATMs can be convenient, and they typically work without problems. However, you may experience problems or have doubts about depositing money at ATMs. Are they safe? Do they have special rules? It’s best to understand some of the pitfalls of ATM deposits so you can potentially avoid unpleasant surprises.

The Safety of ATMs for Deposits

In most cases, your deposits should be successful and error-free. But consider the consequences of an error. Especially when you’re making a large, important deposit — or if you’re in danger of bouncing checks — an ATM might not be your best choice. From time to time, there will be errors. You might not experience any problems in your lifetime, and your bank can resolve most issues without causing additional complications, but you're dealing with a machine that may make a mistake.

There are plenty of horror stories out there about failed ATM deposits. For example, money could vanish immediately after going in the slot, there’s no record of the deposit, and so on. If your deposit is a big deal, go inside a branch and work directly with a teller.

No matter what you’re doing at an ATM, it’s always smart to follow some basic ATM security practices.

  • Choose safe ATM locations. Machines inside bank branches, safe neighborhoods, and areas with security personnel are a good start.
  • Get prepared. Organize your deposit so you’re not fumbling with cash before putting it into an ATM. If you need to use a deposit slip, grab extra and fill one out before heading to the ATM.

If there is ever a problem, an investigation can take several days (at least).

When errors happen, the ATM operator will need to review the transaction, any security footage, the internal workings of the machine (including any jammed bills), and report back to your bank. In many cases, the ATM operator is a separate organization — not your bank. Even if the ATM is located in a bank branch, the employees inside probably cannot open up the machine.

Use Your Bank’s Deposit ATM

You might only be able to make deposits at ATMs owned by your bank. But it’s possible that your bank belongs to a network that allows you to deposit funds with any ATM in the network. Still, it’s best to just use your bank’s ATM.

If you use a deposit ATM from another bank (within the network), your funds might not show up in your account as quickly as if you use your own bank. That's fine if you've got sufficient funds in your account. But it can cause overdrafts, fees, and other problems if you don't.

Funds Available After Your Deposit

Your bank has policies that spell out when funds are available. For deposit ATMs, the rules might be different, so call your bank and check the funds availability policy for details. You can typically expect to have $200 or so available from a check deposit quickly, with the rest on hold and available in several business days.

However, your funds might be available more slowly when you deposit at an ATM. Completing the deposit in person with a bank employee should result in getting your money faster. That said, remember that you’re responsible for any deposits you make. 

If a check bounces or comes back as a fake, you’ll need to replace any money that your bank lets you spend or withdraw.

Alternatives to ATM Deposits

Mobile deposit: If your bank allows it, you might be able to deposit checks using a mobile device or computer and scanner. That approach can help you avoid most of the pitfalls above, and you don't even have to leave the house. It might even be worth opening an account at an online bank that offers those services just to get the benefits of remote deposit technology.

Direct deposit: If you’re constantly depositing paychecks, it may be best to sign up for direct deposit. Doing so will result in funds going directly to your account electronically, and there’s typically no fee for using that service. Ask your employer how to sign up.

Shared branching: If you use a credit union, you may be able to use branches of thousands of different credit unions nationwide through shared branching. Find out if your credit union participates. If so, you can deposit funds with a teller — in person or at a drive-through — at times and locations that are convenient for you.

In some cases, you'll just have to go inside your bank and deposit with a teller. For example, if you're making a deposit of coins, the bank may have specific requirements (and ATMs don't have the ability to accept coins).

Article Sources

  1. U.S. Bank. "Deposit Account Agreement," Page 18. Accessed Dec. 10, 2019.

  2. Federal Trade Commission. "Don't Bank on That Check," Accessed Dec. 10, 2019.