ATM Inventor Passes Away At 84

John Shepherd-Barron, 84: ATM inventor, arguably

May 22, 2010

Daniel Dale

John Shepherd-Barron always withdrew money from his local bank on Saturday mornings. One Saturday in 1965, the bank closed just before he arrived. He had to ask a nearby auto garage to cash a cheque.

Lying in his bath that night, Shepherd-Barron had his eureka moment. Surely there could be a convenient way to allow people to obtain cash whenever they wanted it. If there were machines to dispense chocolate bars around the clock, why couldn't someone invent a similar machine to dispense money?

Shepherd-Barron, born in 1925 to Scottish parents in India, where his father did business, and educated at the University of Cambridge, was managing director of De La Rue Instruments, a British company that printed currencies. Soon after he conceived the automated teller machine in his mind, he ran into an executive of Barclays Bank at a party. “Give me 90 seconds,” he said, and made his pitch. According to Shepherd-Barron, the executive said: “If you can make this device you are speaking about, I will buy it right now.”

The ATM debuted to great fanfare at a Barclays branch in London on June 27, 1967. The star of a British sitcom was the first person to make a withdrawal. He obtained 10 one-pound notes, the only combination of bills the machine could offer.

The ATM, of course, changed banking; there are now about two million cash machines worldwide. In 2007, Shepherd-Barron was given a lifetime achievement award by the ATM Industry Association. In 2005, he was made an Officer of the Order of the British Empire.

It was the announcement of this honour that brought a rival out of the woodwork. James Goodfellow, a fellow Scot, said he was the true ATM inventor, having patented a cash-dispensing device in 1966 that employed a PIN system. Shepherd-Barron's first machine used a PIN too, but it only dispensed cash to customers who inserted cheques encoded with a radioactive substance called carbon-14. Shepherd-Barron, moreover, never patented his concept, later claiming he “wanted to keep carbon-14 secret from potential forgers.” Said Goodfellow: “It's not sour grapes. He invented a radioactive device to withdraw money. I invented an automated system with an encrypted card and a pin number, and that's the one that is used around the world today.”

Perhaps Goodfellow was consoled by the fact that without a patent Shepherd-Barron did not make much money from his money machine. Married with three sons and six grandchildren, he spent his retirement years snail farming, fishing and shooting near his remote home in northern Scotland.

He died Saturday, after a short illness, at 84.