RBI tightens ATM guidelines to prevent fraud

Under new Reserve Bank of India guidelines, you will have to change the way you use ATMs. So far you had to enter your personal identification number (PIN) only once to carry out multiple transactions, like withdrawal, balance enquiry, etc. Now, you will have to re-enter the PIN for every transaction.

The step has been taken in view of the alarming rise in ATM thefts. To check the misuse of ATM cards by hackers and skimmers, the RBI has asked banks to allow only one transaction at ATMs for one entry of PIN.

The transactions that a bank customer can conduct through the ATMs by inserting or swiping the card and entering the PIN include withdrawal of cash, deposits, fund transfer, bill payments and checking account details.

So far, customers were allowed to conduct multiple transactions through ATMs by punching in their PINs only once in a single session. However, the practice is vulnerable to misuse, especially in case customers forget to collect their ATM cards after conducting their transactions.

There have also been cases when some people tamper with the ATM machines in such a way that customers cannot collect their ATM cards after conducting transactions. Once the customer moves out of the ATM area thinking that the withheld card needs to be collected from the bank, the fraudster can withdraw money as the previous session remains active with the PIN already punched in.

After receiving complaints about the vulnerabilities, the RBI asked banks to make changes in their systems to allow only one transaction for every PIN entry.