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The Evolving Security Landscape of ATMs

Safety and security are the hallmarks of the financial industry. Financial institutions must continually and significantly invest in security to ensure they protect their assets, and reputation and maintain customers’ trust. As branches and delivery channels evolve, ATM security processes and protocols must also evolve. 

Of these channels, the ATM is complex when it comes to security. ATMs have a physical and logical component that requires tight alignment with security measures yet must simultaneously be flexible enough to reduce friction in the customer experience. In addition, many ATMs are available outside normal business hours and even outside the branch, making access by bad actors easier and less risky. Locking this channel down safely is costly and challenging.

ATM security threats emerge quickly  

As the leading provider of ATMs and ATM services throughout the Southeast, we continuously monitor ATM threat trends.  What we see is a world in which technologies and threats are evolving constantly. Criminals have responded to new banking services and security systems by developing more coordinated and sophisticated attacks. They attack software services to inject malware into processing systems and use 3D printing to create skimming devices. Miniaturization technology helps them place tiny cameras to capture a customer’s Personal Identification Number (PIN) input.  

Data from the FBI suggests thefts from ATMs surged by 149% between 2019 and 2020 with a further 10% rise in 2021. Data from FICO meanwhile, found that ATM skimming increased by more than 100% in 2022. Crime is rising at a frenetic rate, but our position as a leading ATM service provider makes us better placed than most to understand these trends first-hand with insights that help us respond rapidly to emerging criminal activities through our dedicated ATM experts.     

Compromised ATMs are hard to hide

When it comes to ATMs, one of the more visible security problems Financial Institutions deal with is physical attacks. These are very public displays of security issues because to strong-arm an ATM, significant brute force needs to be exerted. No Financial Institution wants customers to see police tape around an empty concrete pad or a breached branch wall where the ATM once stood. This kind of attack involves high recovery costs as Financial Institutions must secure the physical environment and replace it with another expensive device. Criminals will also tend to repeat attacks as long as the same vulnerabilities persist. Financial Institutions will therefore need to up their game quickly to avoid being targeted again.  

Physical threats can be countered with stronger security measures at the site. Bollards or security perimeters, for example, can hinder vehicle access, making smash-and-grab raids more difficult. Improved video surveillance, alarms, ink staining and good lighting can also deter raids while GPS tracking systems help to trace the thieves.  

One of the most common logical attacks involves phishing in which criminals try to trick employees into handing over their personal details. According to a report by CNBC, 2022 saw a 61% increase in phishing attacks over the previous year.  

To protect themselves from this type of sophisticated criminal activity, Financial Institutions need a Security and Technology partner to help them stay up-to-date and protected from malware trends, network weaknesses, internal security protocols, and emerging threats. Most of all, they have to develop a proactive and sophisticated response that matches the growing complexity of attacks. 

There are no optional security investments  

To maintain a secure ATM environment and to protect itself from the reputational and financial risk of ATM fraud attacks, a financial institution cannot pick and choose which security processes it will invest in. All are important. This is why, in today’s complex operating environment, an ATM as a Service (ATMaaS) option bears serious consideration. 

With this type of service, the cost and operational complexity of establishing and maintaining a secure ATM environment becomes the burden of the service provider. The cost becomes an operating expense rather than capital expenditure, and the ATM program benefits from the experience of a specialist organization focused on ATM security and ATM operations. This frees the FI to deploy resources into more profitable lines of business and protects it from lowering customers’ lifetime value through attrition due to loss of trust.

A robust security eco-system is the best protection  

All customers expect an ATM service that is fast, safe, and convenient.  Financial Institutions that can’t deliver are at a competitive disadvantage. However, the complex mix of business priorities as well as operating and network environments that make up modern retail banking can result in under-investing in channels like ATMs where there are high operating costs and less revenue opportunity.    

That’s why ATMaaS solutions have a key role to play in a bank’s retail operating environment. The best solutions have developed a security eco-system that leverages many years of experience operating and maintaining ATM fleets and networks across the region. The provider of these solutions becomes a Financial Institution’s investment partner in ATM security, instilling confidence in the institution’s ability to offer an ATM channel that is always on and always protected.  

STS Group has the knowledge and experience to be your trusted partner in ATM Security and Service. We are ready to help you fortify your branch against any attacks you may face. Get in touch with us today to get started.