RBI asks banks to upgrade ATMs by Sept ’17 to prevent cloning of cards

ATMs will necessarily be enabled for EMV chip and PIN processing from inception.

By: ENS Economic Bureau | Mumbai | Published: May 27, 2016 1:31 am
RBI atms, banks to upgrade ATM, cloning of atm cards, EMV Chip, pin cards, business news POS terminal infrastructure in India has been enabled to accept and process EMV chip and PIN cards, the ATMs continue to process the cards based on magnetic stripes, RBI said.

The Reserve Bank of India has asked banks to upgrade all ATMs by September 2017 with additional safety measures to process EMV chip and PIN cards in order to prevent skimming and cloning of debit and credit cards.

While the POS terminal infrastructure in the country has been enabled to accept and process EMV chip and PIN cards, the ATM infrastructure continues to process the card transactions based on data from the magnetic stripe, the RBI said. “As a result, the ATM card transactions remain vulnerable to skimming, cloning, etc. frauds, even though the cards are EMV chip and PIN based,” the RBI said in a notification.

It has become necessary to mandate EMV (Europay, Mastercard, Visa) chip and PIN card acceptance and processing at ATMs also, it said. Contact chip processing of EMV chip and PIN cards at ATMs would not only enhance the safety and security of transactions at ATMs but also facilitate preparedness of the banks for the proposed “EMV Liability Shift” for ATM transactions, as and when it comes into effect.

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The RBI said banks in India and the White Label ATM operators should ensure that all the existing ATMs installed/operated by them are enabled for processing of EMV chip and PIN cards by September 30, 2017. All new ATMs will necessarily be enabled for EMV chip and PIN processing from inception. “For the purpose of switching, clearing and settlement of their ATM transactions banks, with the approval of their board, may join any authorised ATM/card network provider,” it said.

Further, in order to ensure uniformity in card payments ecosystem, banks should also implement the new requirements at their micro-ATMs which are enabled to handle card-based payments.

RBI deputy governor SS Mundra recently said the RBI had surveyed almost 4,000 ATMs in India with sample size fairly representing geographies and bank categories. “Almost one-third of the ATMs were found to be not working at that point. Violation of regulatory instructions on display material, facilities for differently abled etc. were also observed. We will be taking necessary supervisory action in this regard,” he said.

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