Scott Terrill, president of ATM Financial LLC, was initially motivated by pride, not profit, when he installed an ATM at Lexington (Ky.) Catholic High School, a private school with an enrollment of 1,500 – and, not coincidentally, Terrill's alma mater.

Acknowledging that he was a less than stellar student, the class of 1990 graduate said, "A lot of people I went to school with probably thought I would end up on a beach somewhere. Now I get to stand tall while people say 'Scott Terrill owns that ATM.'"

Terrill, a former Access Cash representative who started his own business in December of 1998, was approached by his old basketball coach, who knew he had gone into the ATM business. ATM Financial manages about 100 machines and owns roughly half of them.

The site had potential,Terrill said, since many Lexington Catholic students carry bank cards. The school boasts several fast-food franchises and a well-stocked campus store.

Also, Lexington Catholic has a large gymnasium that is rented by community sports leagues and other organizations – even in the summer, when school is not in session. An area college is playing its basketball games there while its own gym is being remodeled. 

"(The school) is never dead.They do an incredible amount of concession sales," Terrill said.

The machine is located just inside the school's main entrance, near the campus store and gymnasium ticket window. The school has even begun using its scoreboard to spotlight the availability of the ATM.

Terrill's company handles everything, including cash replenishment. While loading the ATM is often a significant expense for an ISO, ATM Financial is the rare exception – Terrill's business partners own a security company that also makes cash runs.

Terrill charges a $1.25 convenience fee, less than the going market rate of about $2 at nearby ATMs.The school earns 10 cents per transaction.

In its third month, the machine does slightly more than 100 transactions a month. While Terrill believes the number will grow to 200 or so, he said the real key to making the site work is his partnership with Traditional Bank, a local financial institution.

As with many ISO/FI ventures, Traditional pays Terrill a flat monthly fee in exchange for branding, including screen ads, at the machine and surcharge-free access for their customers.

"(With the partnership), if I get 50 transactions a month, I'm tickled," Terrill said. "The key to making schools and other low-volume sites work is finding a bank or other partner interested in a location. With a school, you want someone interested in marketing to students."

Bill Alverson, market area president of Traditional Bank Inc., said his company was eager to place a machine at Lexington Catholic because "we try to be involved with schools in the community as much as possible."

With only three other Traditional Bank ATMs in Lexington, two at branches and one at a downtown office building (also managed by Terrill), "it helps us get our name out a little bit," Alverson added.

It's more economical for his bank to pay Terrill to manage the ATM rather than doing it themselves, Alverson said. And with the bank branding at the machine, "we look at it as marketing dollars."

Terrill hopes to place his second machine in a high school soon and is negotiating with a school in Indiana.