The problem of cash after closing time
In Britain in the 1960s, bank branches typically closed in mid-afternoon on weekdays and were shut at weekends. Wages were still commonly paid in cash, and many people did not hold a bank account at all. Anyone who needed money outside those narrow hours had few options. The idea of a machine that could hand out cash at any time was attractive, and several people were working on it at once.
Enfield, June 1967
The machine usually described as the first of its kind was installed at a branch of Barclays Bank in Enfield, in north London. It went into public service on 27 June 1967. The comedy actor Reg Varney, then well known from television, was invited to make the first withdrawal in a publicity event.
The device was developed by the security printing firm De La Rue, and the idea is most associated with John Shepherd-Barron, an executive at the company. He is often quoted as saying that the inspiration came while he was in the bath, thinking about how chocolate bars could be bought from a vending machine at any hour, so that cash might be dispensed the same way. Accounts of the story vary in detail, so it is best treated as a colourful anecdote rather than a documented fact.
How the early machine worked
The first machine did not use a plastic card as we know it. Customers instead obtained paper vouchers or cheques from the bank beforehand. These were treated with a slightly radioactive substance (carbon-14, according to the usual accounts) so the machine could detect them. The customer inserted the voucher and keyed in a personal identification number, and the machine matched the two and dispensed a fixed amount of cash. The voucher was retained, and the account was debited later by the bank.
Some features of this early design can be summarised as follows:
- Fixed amount. Reportedly the machine dispensed £10 per transaction, a meaningful sum in 1967.
- A PIN. Shepherd-Barron wanted a longer number, but is reported to have settled on four digits after his wife said that was as many as she could reliably remember. The anecdote is widely repeated, though again its details rest largely on his own later accounts.
- No direct link to accounts. The machine was not connected to the bank’s computer in real time, which is why vouchers were needed.
Competing claims
It is hard to give a single “first”. A machine in a Swedish savings bank branch in Uppsala is often mentioned as entering service around the same time, and a rival British system made by Chubb followed within months. In the United States, an inventor named Luther Simjian had tried a deposit-taking machine in the early 1960s that attracted little use. The Scottish engineer James Goodfellow patented a PIN-based cash-dispensing system around 1966-67, and his work is often cited as an independent invention. Because details differ among sources, it is safest to say that the Enfield machine was the first widely publicised cash machine in regular public use, and that several inventors were working along similar lines at the same moment.
From novelty to network
After the initial installation, machines multiplied in Britain through the late 1960s and 1970s, with plastic cards with magnetic stripes gradually replacing vouchers. As banks began to link machines to their central computers, it became possible to check balances and debit accounts immediately. The spread of this technology fitted with the growth of business computing at the time, including IBM mainframes, which allowed banks to process far more transactions.
In the United States, cash machines became established around 1969 and expanded through the 1970s. Over the following decades, banks connected their machines into shared networks, letting customers withdraw money from machines run by other banks and, eventually, in other countries. By the early twenty-first century the cash machine had become one of the most familiar machines in daily life, although the rise of card and mobile payments has since reduced the amount of cash that many people use.
Why it counts as a milestone
The Enfield machine did more than save a trip to the counter. It was an early example of self-service banking, of the customer working directly with a machine rather than a clerk, and an early step in the spread of automation into consumer finance. It also arrived during a turbulent economic year in Britain, which saw the pound devaluation in November 1967, though there is no direct link between the two.
Shepherd-Barron received an honour, an OBE, in 2005 for his work, and he died in 2010. The question of who deserves the most credit remains open, but the date of 27 June 1967 is firmly attached to the machine in Enfield.