How Do Vending Machine Credit Card Readers Work?

By Bruce Boswell •  Updated: 12/14/21 •  6 min read
Filed under: Credit Cards

Credit Cards are incredible things. They allow you to buy all kinds of things. They ensure that you can buy things that you might not otherwise be able to if you didn’t have your credit card.

That is why understanding how credit cards work is important because if you don’t understand how credit cards work then you won’t be able to get the most out of your credit. 

This is what this piece will explain to you.

Exactly how your credit card works and why it works the way that it does. If you have ever been curious as to how a credit card is made or how do vending machines credit card readers work, then look no further than this article which will explain all. 

How Are Credit Cards Made?

Firstly, let’s tackle the process of making a credit card. It may seem like a complicated and somewhat mysterious process but in fact it is relatively straightforward.

Knowing exactly how your credit card was made will mean you know what type of material it is made from and how to protect it from getting damaged by anything that might make the credit card inoperable. 

To make a credit card, first the information of the person who will be using the card has to be ascertained. This mainly means their name printed on the front of the card as all other information is generated by the bank or credit provider when they are made. 

The main information that is applied to the card is the account number for the card, the signature panel (where you signature will go when you receive your card. Of course, this section is usually left blank and with material that can be easily written on plastered on to it) and the magnetic stripe. 

The account number is generated from billions of possible combinations and no two credit cards from one company have the same number. This is to ensure that nobody ever gets confused over which card and which cardholder made which transaction. 

The card numbers are randomly generated by a computer as well meaning that the likelihood that anyone should get their card mistaken for another person’s is vanishingly small. 

Alongside the card number in terms of importance is the magnetic stripe. The stripe is coated in something called iron oxide. Contained within the iron oxide is binary information which means when the card is read it can be identified as a legitimate card and not one made by a fraudster. 

Once the information which is needed to be printed on the card is available, the process of actually printing the card can begin. 

The material that is used with most credit cards is plastic. But not ordinary plastic – several layers of plastic that has been laminated together in order to be strong and durable.

The centre of the card is made from PVCA, a type of plastic resin that is used to keep the layers of laminated plastic together. 

Once the plastic is put into a machine to melt it and bind it together it goes off to the printing process. The printing process involves the card being printed with the information related to the customer and then laminated in order that the numbers aren’t easily rubbed off. 

The magnetic stripe is then added using a hot stamping process. Once this process is complete, the card is then laminated again in order that it is fully protected.

Once the card has been laminated for a final time, it is die cut and embossed in order that the card is as resilient as can be possible without losing either any quality or making the card too chunky. 

Once the card has been checked by quality control it is then sent out to its final destination – you! 

How Do Vending Machine Credit Card Readers Work? 

Now that we have gone over the process that ensures the credit card is made, let’s take a lot at how exactly vending machine credit card reader’s work. It is important to know how vending machine credit card readers work because if you come across one that is broken or doesn’t seem to take your card you might be able to understand why. 

Credit card readers work firstly by scanning your card so that it can recognize who the card belongs to. This is important because if you want to take money out, the machine needs to access your credit account and to do so it needs to recognize your card.

Many older credit card readers work on a principle of reading your card by you inserting it into plunge reader. You will recognize them as the plastic slot in a machine which has a slot in which you can place your credit card. 

Many newer vending machine credit card readers have a proximity scanner. This means that you can simply hold up your credit card and the machine with scan your card to identify you. However, these machines are relatively new so you may not have come across many of them. 

The reader may then ask for you to enter your pin so that it can be certain you are who your card is saying you are. 

Once the reader has identified you and your card, it will send a message via a transmitting device known as a telemeter. The telemeter uses a Wide Area Network connection (or WAN for short) to communicate with your credit provider and allow you access to your credit card’s account.

Once you have access to the account you can then request the money that you need. The vending machine will then communicate with the bank that it is located in or near to authorise a release of money.

The money itself is usually stored in a special compartment of the vending machine. Once this is all cleared and authorize, you will have access to the money you want and be able to go on your day. 

Why It Is Important To Know How Credit Cards Work

The reason it is important to know how credit cards work is because we rely on them so much. The process by which we get money from credit cards seems awfully simple, but it is in fact very complicated and the simplicity belies the amount of time and effort that has gone in to make the credit card system work as effectively and efficiently as it does. 

It is worth considering all of these things the next time that you visit a vending machine to get some cash out on your credit card or check how much money you have left on it. The technological age we live in is truly astonishing and it really is worth taking the time to appreciate it. 


Bruce BoswellBruce Boswell

Bruce Boswell

Bruce Boswell enjoys researching and writing about all things related to investing and saving money. Whenever he has a chance, Bruce loves travelling all around the world with his wife and trying new foods.