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As banks install anti-skimming device on ATMs…


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Nigeria

IMAGE: Dipo Fatokun, director, banking, payments system department, CBN, »

August.27.2014

With over 90 percent of deposit money banks (DMBs) have complied with installation of anti-skimming device on their automated teller machines (ATMs), then there is no cause for alarm for users over fraud cases.

Although the deadline given to banks to install the anti-skimming devices on all their ATM terminals by the Central Bank of Nigeria (CBN) ended June 1, 2014, a follow up on the level of compliance shows that over 90 percent the DMBs have complied.

Skimming is a technique used by criminals to copy personal data from the magnetic strip on an ATM card. The criminal slots a skimmer device into the card slot of the ATM, when the ATM card user uses the machine, the skimming device is able to read the card details from the magnetic strip on the card and transmit this to a receiver.

ATM card skimming is a constantly increasing and huge problem worldwide.

Dipo Fatokun, director, banking, payments system department, CBN, said: “Banks are complying with the anti-skimming device and what we have done at the CBN, based on the directive of our management, is that we have gone through banks’ ATMs to ensure that they comply.”

He said that in Lagos the one or two banks that had not complied reported the challenges they had and the timeline within which they will comply, saying “more than 90 percent have complied and it is a good thing that the banks saw the need to comply. For those that have not complied, not that they do not have anti-skimming device, it is just that they are doing it in phases.”

Recall that the CBN had given all DMBs till June 1, 2014, to install anti-skimming devices on all their ATM terminals.

This is against the backdrop of an upward increase in the number of ATM related fraud in the banking system, which does not portend good for the industry and requires urgent step to curb the abuse, the CBN said.

The apex bank has in addition to the existing guidelines on card related frauds and in order to guard against card skimming at ATM channels across the country, mandated all banks to comply with the provisions of 3.2 “ATM Operations” and 3.4 “ATM Security” of the Standards and Guidelines on ATM operations in Nigeria and also install risk mitigating devices on their ATM terminals on or before June 1, 2014.

It warned that it would invoke appropriate sanctions on any bank for non-compliance with the directive.

Chuks Iku, former chairman, Committee of e-Banking Industry Heads (CeBIH), said a lot of banks had complied by installing the anti-skimming device on their ATMs

However, the CBN has observed with satisfaction, the growth in the adoption of ATMs, by Nigerians, as one of the channels of e-payment. The regulator therefore reiterated its commitment to ensuring that the deployment and management of ATMs are in line with global best practices.

Analysts see this as a welcome initiative, saying it is positive for both the banks and the customers.

Article Credit: Businessdayonline

Updated 3 Years ago
 

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Tags:     DMBs     ATMs     CBN     Dipo Fatokun    

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