The problem here is space inside the ATM. If you allow space for dollar bills you either have to build a bigger ATM or accept the fact that you will have fewer customer at your machine because it would run out of money. Further, I don't think you would be too happy if you requested $97 and the machine, with its available inventory, supplied you with ninety seven one dollar bills because it ran out of under represented five, tens and twenties. This is the same premise behind the fact that vending machines do not take pennies- there just isn't enough room.

The closest thing I've seen are Bank of the West ATMs, which offer withdrawals in $5 increments. No withdrawal fee, either.

In Canada:The Royal Bank used to distribute 5s as well as 20s.TD did 10s and 20s.

Why? What is the advantage in taking out 23, 57 or 97 $/€/£ or whatever currency. Why not just take out a round 25, 50 or 100?
Most machines are built with 3 or 4 note stacks, and can therefore only handle 3 or four different denominations, e.g. 10, 20, 50, 100. If they had smaller denominations in them, they would run out of money sooner.

This significantly increases the cost and complexity of ATMs. They need to cover their costs. So I would not want this cost passed on to me. I can break a $20 almost anywhere. If I don't have a check or credit card, having $20 is fine.

there are a few atms where live that let's me take any amount I want as long as it is below the maximum limit, the other day I took out 50 cents.

maurici018, is "50 cents" a coin (you don't say where you live, and so I don't know which currency you are talking about)?
I have never heard of an ATM which dispenses coins.

A better idea is to put a change machine next to the ATM. That way, if you want $97, you put in like $10 or $20 and it will give you only that much in coins or small dollar bills. That way you wouldn't have to replace all the ATM's in the country.

I couldn't agree more with your original contributor,Brian Salveson.There is a trend here in the UK to foist large denomination notes on you when your next purchase is going to be a modest takeaway pizza costing under five pounds.Plainly though,there are storage implications for the ATM cash providers.While we're on the subject of ATMs, why not provide withdrawal receipts on RICE paper(A)to cut down on the loutish litter problem associated with the location of cash machines and (B) to provide a digestible form of kerbside privacy.I'm only half-joking , by the way ! Different flavours could also be introduced,summer fruits in summer and mulled wine,say,around Christmas.