The Central Bank of Nigeria (CBN) has given all deposit money banks till June 1, 2014 to install antiskimming devices on all
their Automated Teller Machines (ATMs) 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, Port the CBN said in a circular.
Skimming is a technique used by criminals to copy personal data from the magnetic strip on an ATM card.
The criminal installs a skimming device on top of the card slot of the ATM/SST, e.g. card reader cover, false front or pre-head; when a user inserts his card into the card reader, the skimming device will read the card details from the magnetic strip on the card and transmit these to a receiver connected either by wire or wireless.
Consequently, the CBN 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.
The apex bank warned that it would invoke appropriate sanctions on any bank for non-compliance with the directive.
However, the CBN has observed with satisfaction the growth in the adoption of ATMs by Nigerians, as one of the channels of epayment.
The regulator, therefore, reiterated its commitment to ensuring that the deployment and management of ATMs are in line with global best practices.
Colin Daley, partner, advisory services, Ernst & Young, sees the CBN’s directive as a welcome development, saying it is positive for both the banks and customers.
“I believe that this initiative is positive for customers as they will feel more comfortable when using their cards and it is ultimately positive for banks as they can reduce unintended volumes of traffic to contact centres, whilst reducing the associated costs of investigating fraud queries and replacing compromised cards”, Daley said in an e-mail response.
HOPE MOSES-ASHIKE
