Big changes are coming to the ATM. Some of them may disappear

On September 23, 2023, the Regulation of the Ministry of Interior and Administration issued on September 15, 2021 regarding the introduction of the obligation to secure banknotes in ATMs with IBNS (Intelligent Banknote Neutralization Systems) will come into force. The system will color the banknotes if an attempt to rob an ATM is detected.

Below you can see what Polish banknotes look like after testing by one of the companies (Ferrica SmartStain) that offers these security features in collaboration with NBP.

This coloring agent is safe and at the same time indelible. This means that criminals will not be able to use these banknotes freely. Verica reports that their system responds to all types of attacks: cutting, grinding, and ramming, as well as the use of gas and explosives.

Additional ATM security must be installed by a “payment service provider or other entity providing services to the issuer of the payment instrument”. That is, an operator of an ATM network or a bank, such as Euronet or Planet Cash.

Not all devices must have additional security, but not less than 40 percent. “All owned ATMs, except ATMs located within facilities and buildings that are covered by permanent and direct physical protection.” As experts point out, continuous direct physical protection is available only for devices placed in shopping centers.

There are severe consequences for failure to comply with the provisions of the law – penalty of restriction of liberty or imprisonment of up to two years. The head of any particular banking unit shall be subject to this sanction.

In presenting the regulation, the Ministry of Interior and Administration referred to the “increasing crime phenomenon” of hacking ATMs. And in the explanatory note to the draft regulations adopted in 2021, data for 2018 – 108 of these crimes – and 2019-130 were cited.

“As a result of the commission of such prohibited acts in 2019, losses were incurred in the amount of 6,484,539 PLN (cash stolen) and at least 2,581,241 PLN (property damaged). They were not only incurred by ATM operators. , but also by the owners of real estate where these devices are located (for example, as a result of the explosion of an ATM, damage to the wall of the building in which it is installed) ”- indicated in the document.

The Ministry of the Interior and Administration noted in justifying the regulations that although there are more and more cashless transactions, “ATMs are still a key component of the Polish payment system infrastructure”. Attention was drawn to the fact that the business models of banks assume providing customers with round-the-clock access to cash. So ATMs appeared in unguarded places, giving criminals new opportunities for attacks.

In light of the foregoing, it should be noted that an increase in the level of security of banknotes stored in ATMs, as well as during their transportation, is justified.

The Ministry of Interior and Administration is of the opinion that the preventive effect should reduce this type of crime. Criminals, knowing that the stolen money will be damaged immediately and will not be able to use it, will not attempt to steal it.

As noted by Krzysztof Kołodziejczyk, Vice President of the Polish Organization of Cash Services Companies, the process of modernizing ATMs and installing such additional security is very expensive.

– The cost can be very different, it depends on the type of ATM, the number of protected cassettes, the configuration, etc. We can say that it will generally range from ten to twenty thousand zlotys per device – explains Kołodziejczyk, answering our questions.

ATM operators had hoped the cost would be partially offset by higher interchange rates, but Visa didn’t raise it, and Mastercard added “a small variable portion depending on withdrawal size.”

“This raises concerns that the costs of implementing additional security measures will significantly reduce the profitability of ATMs, and this will lead to the withdrawal of some of them from use. Such a situation would be extremely unfavorable for providing access to cash to bank customers,” notes Kołodziejczak in an entry on his website. web automatykabankowa .pl.

The expert adds that failure to comply with the obligation to introduce an additional IBNS installation will affect potential compensation in the event of an attack.

“Insurance companies are not usually willing to offer deductions for IBNS installation. On the other hand, they clearly state that if ATM owners do not comply with the requirements of the law and there is an attack on the ATM or bank van, they will not pay damages. Be serious. very “.

We requested comment from Euronet and Planet Cash on the introduction of a new ATM security. However, as of the article’s publication, we have not received a response.

At the end of 2022, there were 21.3 thousand people in Poland. ATM machines. In the past five years, nearly 2.5 thousand people have died. machines.