An ATM (Automated Teller Machine) enables cash withdrawals from a payment account. This is why the operation of an ATM is generally considered disbursement business as governed by Section 1 para. 1 sentence 2 no. 1st alt. of the German Payment Services Supervision Act (ZAG).

Section 2 para. 1 no. 14 ZAG provides an exception for service providers who exclusively provide cash withdrawal services.

Section 1 para. 32 ZAG defines cash withdrawal services as the distribution of cash via ATMs to one or more card issuers, without a master agreement with the withdrawing customer in place.

For the German Federal Financial Supervisory Authority (BaFin), the exception only applies if and to the extent the service provider exclusively provides purely manual service activities, i.e. setting up, maintaining and loading the ATMs with cash.

In BaFin’s opinion, however, the independent operation of ATMs constitutes disbursement business within the meaning of Section 1 para. 1 sentence 2 no. 2 ZAG.