A novel approach to ATM innovation

A novel approach to ATM innovation has been dreamt up by one gentleman who has succeeded in building a fully functional ATM completely out of Lego! Developed to coincide with Brick World 2010, the ATM can accept cards and dispense cash as well as coins. We'd love to claim it as our first Lego ATM testing customer reference, but we're still waiting for the call...!

Ian Kerr

What the Payment Council’s report means for the ATM

The UK Payment Council report which was published today highlights both the increased use of the ATM as well as the need for banks to roll out new services at this channel. It is clear that ATMs dominate the way in which consumers access their cash as the report states that cash machine withdrawals have almost doubled in the past decade. Much of the increase in ATM traffic is due to consumers using the terminal in place of the branch so the roll out of new functionality to enable this trend to continue will be key. However, cash use in general was found to be declining, consequently banks must continue to innovate at the ATM in order to ensure that it remains an essential point of interaction with the bank.

To continue to generate cost savings and ROI at this terminal, banks should provide value added functionality and, critically, reliability. Whilst enabling new functionality such as mobile top up and contactless is important, banks must not forget the basics. Keeping ATM networks constantly up and running as the number of services and complexity of the channel increases, will be a critical challenge for banks. ATM downtime can damage brand reputation among a consumer demographic who clearly value and expect a quick and convenient service from their bank. Consequently, traditional manual testing of ATMs is no longer enough and automated testing will be one of the key tools for banks looking to maximise ROI and customer service at this channel.

Ian Kerr

The risk of ATM fraud

According to recent research, ATM fraud is on the rise in the United States and is expected to be the main form of fraud that customers will face in the coming year. All types of ATMs are under attack - from standalone to branch machines - and so banks and network operators need to consider how best to protect consumers from fraud in order to retain customer trust.

EMV is one of the best ways to prevent against fraud as discussed in previous posts. Most countries, including Thailand and the majority of the Middle East, are in the process of starting on the migration path, while countries such as Canada and Australia will be EMV compliant by the end of the next year. While some countries are putting in place the requirements to migrate, other countries including the U.S., are not planning to migrate to the standard in the near future. In the meantime, all non-EMV compliant countries need to ramp up their efforts to prevent fraud in order to protect consumers as much as possible.

There are several interim measures that ATM deployers can take and a recent article on Bank Info Security provides a comprehensive overview of the necessary steps to minimise the risk of skimming at non-EMV compliant ATMs. These include:

• Have a Plan and document it

• Educate Your Branch Employees

• Inspect All Locations

• Set ATM Standards

While the above measures, which have a high operational cost, can yield some results in preventing ATM fraud, it is clear that these are only temporary measures . The success of EMV in combating fraud in other regions, proves that this standard is currently the best form of protection against fraud at the ATM. As the risk and prevalence of fraud increases across the globe, it is critical that all individuals and financial institutions take the necessary action to prevent it and consider adopting EMV standards.

Ian Kerr