ATM Fraud: What It Is and the Different Types of ATM Fraud in India

Personal Finance

As time has progressed, so has technology at an exceptional rate. It is no surprise that ATMs (Automated Teller Machines) are now mainstream in nearly every city/town. Whether it is on banking premises, in marketplaces, on regular streets, etc., you can often spot an ATM. With the advancement of automation, ATMs have undergone numerous changes. However, it is also a fact that ATM fraud and scams have become rather common as well.

What is ATM Fraud?

Simply put, ATM fraud is a crime done through ATM machines. ATMs inevitably possess some or other vulnerability that scammers can exploit for themselves. Why do such people find ATM fraud an excellent means of unfair income? To understand the reason, we first need to analyze the components of an ATM very briefly. The computer analog system and a secure vault are the two primary components of an ATM machine. Thieves can get past the fringes of the safe with different kinds of lockpicks. As for operating system vulnerabilities, malicious software usually finds its way into the system through portable devices or when it is hacked during software updates.

Access to the ATM’s operation system makes it simple for criminals to illegally draw out the user’s cash. More than a dozen types of malware exist today for ATM scams. Besides, the firewall protection for many ATMs is not up to scratch, increasing the possibility of cybercrimes.

We shall now delve into the most common forms of ATM fraud.

Types of ATM Fraud

With immense progress in cyber networks and technical fields, digital crimes have also gained a great deal of momentum. ATM frauds, likewise, have also increased manifold. Criminals use various strategies to get access to ATMs and withdraw cash illegally from others’ accounts, be it physically or via technology. The most prominent types have been mentioned below. 

Card Shimming:

This is the most common card swindle method used by con artists. It is a thin board that slips discreetly into a card reader. When you insert a card, it reads and stores data from the magnetic stripe without interfering with the usual card services of the bank. This way, the crooks acquire all the crucial data and create a version of your card that can be used in stores.

Card Trapping:

Fraudsters frequently find a way to install a device in the ATM Card Reader that prevents the card’s owner from withdrawing the card after the transaction has occurred. Scammers typically use hidden video cameras built into ATM faceplates to obtain PINs. They can then use the card left behind to withdraw the money from the ATM.

Card Skimming:

Skimming is an illegal practice in which a hidden device is inserted in the ATM and provides the ability to read details of the user’s card while the transaction is being made through the ATM. As a result, the criminal creates a duplicate card with his/her PIN code written on the magnetic strip. These cloned cards are used by criminals to withdraw cash whenever they wish. This is one of the most undetectable forms of ATM Fraud.

Keyboard Jamming:

Through certain means, fraudsters render particular keys on the ATM’s keyboard jammed to prevent the individual from withdrawing cash from the machine. As soon as the confused person leaves to fetch help, the person committing fraud enters the booth and withdraws the money since the user has already entered the necessary details.


This particular form of ATM fraud is committed when scammers craftily steal passwords, card numbers, and CVVs from cardholders. Elderly individuals and amateurs are their usual targets. The criminals make use of personal data to obtain access to accounts to which bank cards are linked, allowing them to withdraw the money at their will.

SMS Fraud:

In this type of ATM fraud, the fraudsters will send you an SMS saying your ATM card is blocked or has been used for suspicious activity, like an unauthorized withdrawal. To prevent it, they will ask you to enter your card details, like the card number, CVV, PIN, expiration dates, etc. Once you enter the details, those participating in this fraud will receive the details and use them online. This is one of the most common types of debut card frauds.

Ways to Prevent ATM Frauds/Scams: 

Now that you are well acquainted with ATM fraud and its variants, it’s only understandable that you would also want to know just how to avoid such crimes. The following measures will be of great aid to you in preventing ATM scams from happening to you or your acquaintances. 

  1. Do not use ATMs installed in lonely or sparsely populated regions.
  2. Before you put your card in the card reader, you should always look for any kind of suspicious device.
  3. The authorities should regularly have the ATM hardware and software monitored and updated.
  4. Do not reply to suspicious messages sent via SMS or email. A scammer is likely trying to gain access to your bank details.
  5. Be careful of any hidden cameras installed in the booth.
  6. Never disclose your card details, like the CVV, export dates, etc., to anyone, be it your closest colleague or relative.
  7. Avoid removing someone else’s card that has been inserted into the machine. The actual offender might frame you for the crime.
  8. If you sense people hanging around an ATM booth, it’s wise to avoid drawing cash from there.

Final Thoughts:

It is common for people to use ATMs without being cautious enough, and they often become victims of ATM fraud. There is a necessity to spread awareness about this particular monetary crime among the public. Besides the general public, banks themselves should use the proper software to prevent these crimes from taking place.

 For more details on various types of debut card fauds and tips for avoiding them, consult the Piramal Finance website.