ATMs to shake off skimmers

Westpac's head of e-business Stu Woollett explains new ATM security technology and offers safety tips.

What is the new security technology and how does it work?

"Jitter" technology is a change in the way an ATM machine pulls the card in. The jitter mechanism subtly vibrates the card backwards and forward as it's drawn into and ejected from the machine. That prevents skimming devices from being able to properly read the magnetic stripe on your card. To give an analogy, if you imagine an old-fashioned cassette recorder jerking a tape backwards and forwards rapidly as the music plays the sound will be mixed up and addled. It means whatever information a skimmer gets from your card will be gobbledegook.

Who is using this jitter technology?

Jitter technology is used widely overseas, and the major banks here are all at different stages of deploying it. Westpac is currently rolling it out nationwide and aims to have all its ATMs fitted with it by the end of September.

Will bank customers notice the difference?

Probably not. It's very easy for us to deploy from the aspect of managing customers' expectations in that the ATM looks the same. So there's no need to re-educate the market, apart from reassuring customers that these machines are now protected.

Will these steps put an end to skimming?

Fraudsters are clever people, and there's no guarantee they won't find a way to overcome this, but at the moment it's a very strong solution. The problem will be with us in some form as long as we have data held in magnetic stripes on cards. The complete solution is to move away from magstripes to cards which carry data on a chip. We have a project to do this but it's not that simple. The global platform which banks and financial services providers use has been built on magstripe technology. So if Westpac alone updated to chip technology, our customers wouldn't be able to use their cards in other banks' ATMs or overseas. It's going to be a long-term exercise, and at this point we don't know when magstripes will become obsolete.

In the meantime, are there measures customers can take to protect themselves against ATM fraud?

Yes. Be vigilant. If the ATM doesn't look as you think it should, don't use it and report it to the bank. Look out for unusual fixtures, such as a brochure holder - skimmers have been known to hide miniature cameras in fixtures around the machine in order to view you using your PIN. Obviously, you're not going to be an expert, so it's really a case of a commonsense check.

Cover your hand whenever you enter your PIN. This applies to Eftpos transactions as well as ATMs. Skimming can't work properly unless someone gets your PIN as well as your magstripe data.

Never disclose your PIN - not even to bank staff or the police. We will never ask you for your PIN details.

Be wary of anyone offering you assistance or hanging around an ATM, even if you are experiencing difficulty with a transaction. If in doubt, walk away and don't use the machine.

Regularly review your transactions. If you see anything suspicious, report it immediately to your bank.

Stand close to the ATM and use your body to block the screen when you make a transaction.

Will ATMs themselves become obsolete?

One day they will, but that day is a long way off. ATM transactions are still increasing and the number of machines nationwide has risen from 1600 in 2001 to around 2250 today.

* Is jewellery just something to keep husbands out of the dog box, or can it be a smart investment? Win Charlebois, director of The Diamond Shop in Auckland, addresses the issues. Send your questions to Money Editor, Herald on Sunday, PO Box 32, Auckland or you can email maria.slade@heraldonsunday.co.nz.