Hi, was just always curious about this:
How do ATMs work in terms of when they’re paired with slot machines?
I sometimes see ATMs near slot machines and don’t understand how they profitably make money. I get they charge like a £3 fee or something for convenience but if a person withdraws like £50 and inevitably loses it all to a slot machine that means you only make £3 profit if it’s your own money in the ATM.
I also hear about third parties lending you money or something like that but I don’t know what the companies are and I don’t really understand how that works either in terms of how it’s profitable for both parties.
Many thanks to anyone who takes time out of their day to respond. I’m kind of just looking into the slot machine business because I hear it can be very profitable if you build up a lot of them.
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The bank that runs/pays for the ATM isn’t really trying to make a big profit off of the ATM – the ATM isn’t its own business, it’s just something to make the bank more convenient to use. The fee is to offset the cost of supporting the ATM. Once it’s out of the ATM, the bank no longer cares where the money goes – you could spend it on groceries or lose it gambling, it’s all the same to the bank.
Unless you’re saying that the ATM is owned by the same people who own the slot machines? In which case, yeah, that would not make very much sense. Sometimes there are *change machines* near slot machines – those turn other kinds of money (bank money, paper money) into coins you can use in the machines. You keep the other money, though, plus any fees, *and* you keep the coins when you empty your slot machines, so the profit there is pretty straightforward.
Private loans work the same way banks actually make their money. You say, “I need to spend £1000 on bills/goods/gambling addictions, but I don’t have £1000 right now.” The loan company says, “We have £1000. You can borrow it, but you’ll owe us £1500 later.” The company profits because – if they get paid back – they made £500 profit on the loan. The person who took the loan doesn’t profit – they lose an extra £500! – but sometimes owing extra money later is the only option they have to avoid trouble *now.*
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