One of the most common questions we get from new entrepreneurs across the country is: “How do I apply for my ATM business license?”
Most people expect a complex application process, a background check from the state, and a fancy certificate to hang on the wall, similar to a liquor license or a contractor’s permit.
The reality is much simpler—but also more specific than you might think.
The Short Answer: There Is No “ATM License”
Let’s clear up the biggest myth immediately: Neither the Federal Government nor your State Government issues a specific piece of paper called an “ATM License.”
You do not need to pass a specific exam or pay a specialized “ATM tax” to buy a machine. However, this doesn’t mean you can just buy a machine and plug it in. Instead of a single “license,” you need a standard business setup to operate legally and connect to the banking network.
The 3 Things You Actually Need (Instead of a License)
Since there is no single permit, “licensing” is really just a combination of setting up a legal business entity and getting approved by a processor. Here is the checklist you actually need to worry about:
1. General Business License / Tax ID
While you don’t need a permit for the ATM itself, you do need a standard business license to operate within your city or county. Depending on your state, this might be called a “Business Tax Receipt,” “Seller’s Permit,” or “Resale Certificate.”
You will also need an EIN (Employer Identification Number) from the IRS. This is essentially a Social Security Number for your business, and it is required to open a business bank account.
2. LLC Registration (Entity Formation)
You cannot run a scalable ATM business as a “hobby.” You must register an LLC (Limited Liability Company) with your state’s Secretary of State.
This serves two purposes:
- Protection: It protects your personal assets (house, car, savings) from business liabilities.
- Legitimacy: Banks and location owners will not sign contracts with an individual; they want to do business with a registered company.
3. The Processing Agreement (Your “Real” License)
This is the most critical document. An ATM Processing Agreement is a contract between you and a registered ISO (Independent Sales Organization).
This document grants you permission to connect your machine to the national banking network (Visa/Mastercard). Without this signature, your machine is just a heavy metal box that cannot dispense cash.
If you are looking for a sponsor to help you get compliant, you can start your ATM business with us to get your processing agreement handled quickly.
The “Hidden” Compliance: FinCEN & Banking
While you don’t need a license, you are monitored. Because ATMs deal in cash, the Federal Government wants to know who owns them to prevent money laundering.
As of 2024/2025, most LLC owners must file a Beneficial Ownership Information (BOI) Report. This isn’t a license application, but it is a mandatory federal filing to declare who actually owns and profits from the company. Review the new updates regarding the BOI reporting, based on the last law suits this may not apply to you, your partners or your business structure.
You can learn more about these requirements directly on the official FinCEN website.
Do I Need a City Permit for My ATM?
In 99% of cases, No.
If your ATM is located inside a convenience store, barbershop, or hotel lobby, you generally do not need a specific city permit because the business hosting the machine is already licensed for retail occupancy.
The Exception:
If you are installing a “Through-the-Wall” machine that faces a public sidewalk or street, you may need:
- Encroachment Permit: If the machine or the user standing at it occupies public walking space.
- Signage Permit: If you plan to add a large neon “ATM” sign to the building’s exterior.
Summary
Don’t let the fear of “red tape” stop you from building passive income. The barriers to entry are low. You don’t need a specialized degree or a difficult government license—you just need an LLC, a bank account, and a trusted processing partner.
