Editor’s note: Automated teller machines, better known as ATMs, are turning 50 on June 27. Computer science professor Pradeep Atrey, from the University at Albany, State University of New York, explains the security features and concerns of modern cash machines.
1. How does an ATM work?
In the broadest sense, an ATM works by accepting a cash request from a user, verifying the user’s authority to access a particular bank account, ensuring that account has enough money to fulfill the request and dispensing the money – all without the assistance of a bank clerk or teller.
When using modern ATMs, a customer inserts a plastic card into the machine’s reader, which registers either the data encoded on the card’s magnetic strip or its embedded chip. It prompts the customer for a personal identification number, usually called a PIN, often four or six digits long.
If the card and PIN match, then the customer can deposit money, check an account balance or, most commonly, request a cash withdrawal. When the customer specifies an amount of money, the machine uses an internet connection or a phone line to connect to the customer’s bank, verifying the funds are available and dispensing the cash.
A more sophisticated theft involves covertly monitoring the device and its users. Thieves can install small cameras in different places on an ATM, sometimes hidden by plastic panels that look like normal parts of the machine. With those, they can capture the card number, its expiration date, the name on the card, and even the three-digit card verification value (CVV) number on the back.
That’s more than enough information to use the card to make unauthorized online purchases look legitimate. Fraudsters may also sell the data in online black markets. By installing fake card slots, or even extra attachments (called “skimmers”) on top of the existing card slot, attackers can read the information on cards’ magnetic strips. That can help them make fake duplicate cards to use in other ATMs.Hidden cameras also let thieves watch users enter their PINs. A recent study found that a thermal camera can also capture PINs, by identifying which number keys are slightly warmed, because they were pressed by the user. Specifically, the researchers found that PIN detection accuracy could be up to 78 percent when the heat traces on the key pad are captured within 30 seconds of authentication.
A similar study reveals that it was possible to find all four digits of the PIN from a distance of 35 centimeters and if the thermal camera was placed at an angle between 30 and 45 degrees. However, it was much harder to identify the correct sequence of the digits.
3. Can ATMs be hacked?
Tech-savvy criminals have several options for hacking ATMs. The outer casings of ATMs often conceal hidden USB ports, used for software maintenance and update. If an attacker can locate the hidden port, he can insert a portable USB drive with a malicious program installed, taking control of the machine. That essentially allows the attacker to dispense cash without using a card.
A few years ago, a new attack became popular. Called a “black box” attack by police, the theft involves cutting holes in the ATM casing and physically disconnecting cables between the computer and the mechanism that actually dispenses the cash. Plugging another computer into the cash dispenser’s controls lets an attacker order it to release large amounts of cash.
The ATM’s telecommunications connection offers another means of attack. By intercepting communications between the machine and the bank, an attacker can collect useful card and account data. That may also offer a way to remotely install malicious software and take control of the machine itself: for instance, to issue commands to dispense cash.
4. What security measures are or can be deployed?ATM-related fraud and theft can’t be completely prevented. Banks are working to develop additional security measures, such as the three-digit CVV on the back of cards. Individuals can also take preventive measures to protect themselves when using ATMs:
If your bank issues them, use a chip-enabled card. They provide improved security by verifying the physical card is genuine, and not a fake duplicate.
It is often safer to use an indoor ATM, rather than one directly on the street, which can be accessed more easily by criminals either before or after your transaction.
Check the ATM to see if it looks like it has been physically altered or damaged, if anything is attached to the built-in card reader (to read the magnetic strip) or if there are any small cameras around the keypad. Avoid using it if anything looks suspicious.
Be careful of your surroundings and the people in the ATM area. A person behind you in line may be trying to catch a glimpse of the PIN you enter on the keypad.
Cover the key pad when entering your PIN so no observer or spy camera can see it.
If you enter the correct PIN but the transaction fails, immediately contact the bank that issued the card to warn them that there might be a problem with the machine or your account.
5. How can new technology make ATMs more secure?
As the ever-escalating arms race between ATM security professionals and criminals continues, customers will find themselves urged to use increasingly advanced security methods to identify themselves at ATMs. One method is two-factor authentication, which adds an additional layer of security a user must pass before being allowed access to an account.
Without this one-time code, an attacker can’t access the victim’s bank account.Future methods of user authentication at ATMs are likely to involve biometrics, like fingerprints, which could augment – or even replace – the cards and PINs that have gotten banks and users through the past 50 years of automated banking.
Banking habits continue to evolve as consumers are given more and more choices of where and how they bank. While traditional banking still has its loyal fanbase, it’s hard to compete with the convenience of being able to manage your bank accounts from a computer or smartphone.
The appreciation for face-to-face human interaction that comes with the best banks and credit unions may never go away, but the reputation that traditional banks have for charging high fees and paying low interest rates might leave you wondering how exactly you’re benefiting from keeping your money there.
When compared with traditional brick-and-mortar banks, online savings accounts often offer better interest rates, giving your savings a chance to grow. This is especially true if you open a high-yield online savings account. Learn more about these types of accounts and how you could benefit from one.
What is an online savings account?
An online savings account is a savings account with a financial institution that usually doesn’t have any brick-and-mortar branches and operates fully online. Even though they’re completely digital, online savings accounts must follow the same banking regulations as traditional banks, such as Regulation D of the Federal Reserve limiting the number of withdrawals each month to six.
Since all of your interactions with your account take place digitally, you have the freedom to manage your savings when and wherever you like, without the hassle of having to add another stop to your schedule or having to wait for the bank to open. The websites and mobile apps for online banks are essentially storefronts, so online banks often devote lots of resources to make sure they’re optimized and easy-to-navigate. This allows you to skip the lines at the bank and seamlessly move your money around with just a few clicks.
The absence of physical locations also means online banks don’t have to pay the typically associated costs, such as maintenance or real estate costs. These savings are often passed on to online bank customers in the form of higher interest rates, lower fees, no monthly maintenance fees, and no minimum account balances. This gives customers more flexibility and freedom to do what they want with their money. This means they can be a good fit for financial goals like building an emergency fund.
Online savings accounts do have their drawbacks when compared to a traditional brick-and-mortar bank, however. If you regularly deal with cash, for instance, you might find yourself without any means of depositing into your account. That’s because some online banks don’t provide ATM access. This might require a separate checking account just to handle these sorts of transactions. For those who don’t want accounts spread across multiple institutions, this could be an inconvenience.
On the plus side, there are online checking accounts that provide debit cards that can even earn you cash back or that provide budgeting tools in their mobile apps. So it’s important that you shop around to see what each bank offers and to find the account that fits your needs.
How do deposits and withdrawals work in an online savings account?
Most online banks offer several ways to make deposits and withdrawals, though they might vary from bank to bank. Here are the most common ways to fund and get money out of an online savings account:
Depositing funds into your account
Transfer funds from a linked account, also known as an ACH (Automated Clearing House) Transfer (usually takes one to three business days)
Things get a bit more complicated when it comes to depositing cash because of the lack of physical branches. While there are some online banks that have a few retail locations, like Capital One cafes, these are few and far between. If you find yourself needing to deposit cash, you can try one of these options:
Cash deposits
Deposit locally into an account with a physical branch and transfer the funds electronically
Buy a money order and deposit it like you would a check
Load cash onto a reloadable prepaid debit card, such as the American Express Bluebird card, and transfer the money electronically to your online savings account
Deposit into a ATM that accepts cash deposits (if available)
Top savings accounts for June 2022
With so many savings account options to choose from, it can all be a bit overwhelming. Factors like a high APY (annual percentage yield), minimum balance requirements, and fees are incredibly important when making your decision. You could get stuck with a low yield or hidden fees. Luckily, we’ve made it easy for you to pick the best option to start earning interest today. Check out our list of the best savings accounts for June 2022.
How to open an online savings account
If you decide that an online savings account can help you meet your savings goals or other personal finance goals, then you may be ready to open an account. The process for opening an online savings account is pretty straightforward. It should only take a few minutes and usually involves completing these steps:
Fill out the application Here you’ll submit your personal identifying and contact information, including your name, date of birth, address, phone number, email, and tax identification number (such as a Social Security number).
Choose your account typeYou’ll need to decide whether you want to be the sole account owner or if you want a joint account. If you choose to have a co-owner, you’ll need to enter the personal information of each account holder.
Designate beneficiaries In this section, you can choose who will receive the money from your account in the event you pass away.
Fund the account How much you must deposit depends on the bank — many require just $1, but others may require a larger minimum deposit to open the account. Once you decide on the amount, the most common methods to fund the account are by bank transfer, sending or depositing a check, or using a wire transfer.
Set up your login information Since access to your savings account is online, you’ll need to set up a username and password to complete the setup of your account.
What kind of interest rates can I expect?
Higher interest rates are one of the major benefits of online savings accounts, though they vary from bank to bank. An account with Capital One 360, for instance, will give you an interest rate of 0.70% (as of June 3, 2022), while the Aspiration Spend & Save account offers up to 5.00% APY with Aspiration Plus (as of June 3, 2022). Online banks are generally a good place to look for a high-yield savings account with a competitively high APY.
How can online banks offer such good interest rates?
Because online-only banks don’t need to pay the employee wages, maintenance, and real estate costs associated with brick-and-mortar branches, they can charge fewer fees, require no minimum balance, require a low or no minimum opening deposit, and usually offer better interest rates.
What is the typical minimum balance for an online savings account?
The minimum balance requirement for an online savings account is usually structured one of three ways:
No minimum balance, which is typical for many online banks
A minimum balance to keep the account open, which could be as little as $1 or as much as several thousand dollars
A minimum balance to earn the advertised high interest rate, with anything less earning a lower APY
Is online banking safe? Is my money insured?
You’ll want to make sure your new bank has the words “member FDIC” somewhere on its website or marketing materials. The FDIC, or Federal Deposit Insurance Corporation, is an independent agency of the United States government. If you deposit money at an FDIC-insured bank and the bank later fails, your money is protected (typically a maximum of $250,000 is covered) by that FDIC insurance
However, banks are not mandated to be FDIC-insured, so it’s always important to make sure the bank you’re considering is. To see if a bank is FDIC-insured, you can go to the FDIC BankFind page. If you are banking with a credit union, you’ll want to be sure they are covered by the NCUA.
Even if the account is insured by the FDIC, you want to make sure the bank you choose uses robust technology to protect your money because the FDIC does not provide reimbursements for fraud perpetrated against accounts.
Most banks offer some type of security guarantee and limited liability protection for its customers. Ally Bank, for example, offers a security guarantee, which states “that you will not be liable for any unauthorized Online or Mobile Banking transaction as long as you report the unauthorized transaction…within 60 days from when your statement is made available.” Ally also offers a range of security measures, from account monitoring to free anti-virus software that can protect up to three devices.
There are also measures you can take yourself to help protect your account from such events, such as setting up multi-factor authentication and text alerts, using difficult passwords, avoiding public Wi-Fi when accessing your bank information, and installing anti-virus software, to name a few.
Is your money stuck in an online savings account?
No. Just like a traditional savings account, your money is accessible to you when you need it. With just a few clicks, you can move money in and out of your savings and into another account.
Transfers to an account within the same bank are usually instant, while transferring to an account with a different bank might take a few business days before the funds are made available.
Citing the impact of Covid-19 on many consumers’ finances, some banks, including Ally Bank and KeyBank, have stopped charging overdraft fees or have offered relief from them. Other banks, however, have gone in a different direction. Between March 13, 2020, and September 20, 2021, account holders filed over 1,600 complaints against various banks to the Consumer Financial Protection Bureau (CFPB) about overdraft fees, the agency’s records show.
“Wells Fargo picks and chooses when they are going to charge overdraft fees and when they are going to pay a bill or not,” one complaint filed against Wells Fargo on September 1, 2021, reads. “I will go to sleep and my account [is] positive and there is enough to cover pending charges. Then all of sudden days later the date of the [charge] is changed and I have been charged an overdraft fee. They have recently even had notices within the app that says your balance amount may not be accurate.”
These fees, which can be as high as $35 per overdraft transaction, are an incredible hardship for some consumers. As the complaint continues, “I have a second chance checking account and because of some hardships I am limited in who I can bank with. I feel like Wells Fargo takes advantage of the underprivileged.”
Overdraft fees composed $2.32 billion of those service charges in Q4, a 64 percent spike from Q2 2020
Though some US banks temporarily paused on charging overdraft and other service fees, an analysis of banks with more than $1 billion in assets and some smaller institutions that chose to disclose data suggests that banks are on their way to charging service fees at pre-pandemic levels even as the Covid-19 pandemic resurges.
A March 2021 report from S&P Global Market Intelligence indicated that banks collected $3.6 billion in service fees in the fourth financial quarter of 2020. Overdraft fees composed $2.32 billion of those service charges in the quarter, a 64 percent spike from just six months prior in the second quarter of 2020, the report noted.
Put simply, these fees amount to another tax on the poor, an extraction from the country’s poorest Americans to its wealthiest banks, experts say. Overdraft fees are meant to safeguard banks from risks associated with covering account holders’ overspending, but they can disproportionately hurt low-income consumers who need protection the most, experts told Vox.
Lawmakers and advocacy groups had called for the curtailing of these fees even before the Covid-19 pandemic disrupted the US economy. Now, the call to regulate bank fees has returned as the coronavirus crisis continues to upend consumers’ financial lives.
Why do banks charge account maintenance and overdraft fees?
The FDIC defines overdraft fees as a fee assessed whenever an account holder spends more than what’s in their account. Banks may also charge an account maintenance fee, also known as monthly service fees, just for having the account or for falling below a certain minimum balance, per the FDIC. Banks, of course, can charge a range of other fees, including ATM use fees, per-check fees, and stop-payment fees.
It’s hard to pinpoint when banks began charging overdraft fees in the US. Vox reached out to JPMorgan Chase, Wells Fargo, and Bank of America to ask when they started charging account maintenance and overdraft fees, but none of them shared when they implemented these charges.
According to a 2020 report from the Center for Responsible Lending, banks historically declined debit card charges when account holders lacked the funds to cover charges. But over time, banks — at the urging of software consultants who were promoting overdraft programs on a contingency fee basis — began allowing overdraft transactions to go through and charging customers fees.
“I think that at some point it was clear that it was a helpful situation, so that bills didn’t bounce, checks didn’t bounce, mortgage payments didn’t bounce,” said Peter Smith, senior researcher at the Center for Responsible Lending. “This was a fairly informal service, but when people started using debit cards more [and] people started using electronic payments more, I think banks began to see this as an opportunity for revenue and not just a convenience service they could offer their account holders.”
“I think banks began to see this as an opportunity for revenue and not just a convenience service they could offer their account holders”
Though overdraft fees can be costly for low-income households, they make up a small share of banks’ overall income. Per the Center for Responsible Lending’s analysis, bank overdraft fees average $35. That fee tends to be higher than the value of the transaction that triggers it, which is $20 on average. For banks with assets of $1 billion or more, overdraft or insufficient funds fees are about 5 percent of their non-interest income, the report noted.
Banks charge overdraft fees to account for the risks associated with covering charges on overdrawn accounts, said Deeksha Gupta, assistant professor of finance at the Tepper School of Business at Carnegie Mellon University. Though banks are profitable without charging these fees, they want to avoid risks for paying merchants’ charges and deter account holders from overspending, Gupta said.
Bank fees’ impact on vulnerable consumers
Banks don’t want to take on the risks of covering consumers’ overdrawn transactions, but it remains up for debate whether the fee is truly worth it given its impact on low-income consumers. Overdraft fees tend to prey upon low-income consumers, Rebecca Borné, senior policy counsel at the Center for Responsible Lending, said. The center’s 2020 report found that 9 percent of bank account holders pay 84 percent of the more than $11 billion overdraft fees banks collect every year.
Borné said while other fees serve a function — it does cost banks to administer checking accounts, rendering account maintenance fees somewhat necessary, for instance — with overdraft, the effect is different. Besides charging a high overdraft fee per transaction with insufficient funds, banks engage in a range of practices that can leave customers with compounding overdraft fees, including charging more than one fee per day, charging fees for debit card purchases and ATM withdrawals, and imposing another overdraft fee if previous fees aren’t paid within a set period of time, the Center for Responsible Lending’s report explained.
As some banks resume charging overdraft fees, pre-pandemic research suggests such fees play a role in excluding unbanked consumers from accessing traditional bank accounts. According to the FDIC’s 2019 How America Banks report, about 5.4 percent (7.1 million) of US households were unbanked, meaning nobody in the household had a checking or savings account at a bank or credit union.
Among the reasons why respondents said they don’t have a bank account: Almost half of respondents said they don’t have enough money to meet minimum balance requirements, and more than a third said bank account fees are too high.
Complaints filed to the CFPB offer a window into consumers’ struggles with overdraft charges. “In … 2021, US Bank had enrolled me into an overdraft protection program which I never authorized. One time I was out traveling and forgot to put money in my checking account, and my balance hit negative. I was unaware and kept using my debit card for small transactions like coffee,” reads one complaint filed August 27 against US Bancorp. “The majority of these transactions are below [$10].
Instead of declining these charges, US Bank charged me a series of overdraft fees, each of them [$36]. In the end, the total overdraft fees ended up being [$360] for over a couple of days. They waived three of them, bringing my loss down to [$250] … Talking to their customer service, they never offered an option to opt out of their overdraft ‘protection’ program. They offered some even more predatory protection options instead which I declined.”
With bank fees pushing consumers away from traditional bank accounts, vulnerable consumers may be driven to use even costlier alternative financial services. According to a May 2020 Federal Reserve report, 16 percent of US adults were underbanked in 2019, meaning they had a traditional bank account, but also used alternative financial services like check cashing services, money orders, and payday loans.
The report also noted that unbanked and underbanked Americans were more likely to have lower education levels, be people of color, or have lower incomes. For consumers who are worried about overdraft fees, they’d rather turn to riskier alternatives instead.
As for why consumers turn to alternative financial services, some consumers have no other option, and these alternatives are actively targeting them. The Federal Reserve report noted that 43 percent of credit applicants with incomes of less than $40,000 were denied credit, compared to 9 percent of applicants who earn more than $100,000.
Even for underbanked consumers who have traditional bank accounts, payday lenders and other high-cost installment lenders aggressively target customers in low-income neighborhoods, communities of color, and people who need extra cash, Borné wrote in a follow-up email. Meanwhile, banks don’t always offer affordable small loans for consumers, and they have little incentive to do so because regulators can allow them to charge high overdraft fees for each overdraft, she added.
“Those who go to payday lenders because they believe they will be in and out of the loan quickly are often stuck for the long term, incurring a lot of overdraft fees when the payments are extracted from their accounts,” Borné wrote. “Ultimately, they often lose their accounts. These wealth-draining products tend to feed each other, creating needs rather than filling them, and leaving customers with fewer credit options down the line.”
“These wealth-draining products tend to feed each other, creating needs rather than filling them”
Gupta agreed underbanked and unbanked consumers are often forced to turn to more expensive alternatives. As the coronavirus pandemic continues with no discernible end in sight and assistance programs come to an end, overdraft and account maintenance fees can compound for households that are struggling now, she added.
“Ideally, the banking system should be helping low-income consumers. We don’t want that type of money to be flowing from lower-income households to banks because they’re in overdraft,” Gupta said of the billions of dollars in overdraft charges.
Even though overdraft fees and other service charges make up a small share of major banks’ revenue, some experts questioned whether limiting these fees would disincentivize banks from offering affordable financial services that could attract low-income consumers. As Gupta explained, some banks could opt not to offer certain affordable bank accounts to avoid taking on additional risk. An April paper from the Consumer Financial Protection Bureau also suggested that capping overdraft fees could cause banks to offer fewer affordable account options for low-income people.
What to do if you’re being charged too much in overdraft fees
Banks could do a better job of disclosing bank fees to consumers, said Desmond Brown, assistant director of the CFPB’s office of consumer education. He said depending on the institution, overdraft fees can be structured in a complex way. Some bank accounts offer the option to opt in to overdraft fees, so consumers should see whether it’s an option to opt out when looking for a new account.
When signing up for a new account, Brown said, consumers concerned about fees should shop around and ask for bank accounts that are tailored to low-income consumers and learn about the bank’s cost structures. Consumers can also look for banks that provide alerts when their funds are low, he added.
Brown also encouraged consumers to file complaints with the agency if they’re experiencing fee problems with their bank. Doing so not only allows CFPB to assist consumers directly, but it also helps the agency assess issues happening in the marketplace, he said.
“If we have seen a spike in an area of complaints, then we can look to other tools at the bureau to help drill down and find out exactly what’s going on, and be more responsive to consumer needs,” Brown said.
For consumers looking for affordable bank accounts, Brown pointed to the FDIC’s Model Safe Accounts program, which works with banks to determine how they can offer affordable bank accounts. Some financial services firms offer accounts with no overdraft or account maintenance fees.
(In their respective statements, JPMorgan Chase said during the pandemic it has waived $650 million in fees, including overdraft fees, between January 2020 and March 2021; and Wells Fargo touted its low-cost, no-overdraft-fee bank account, its zero balance alerts, and its overdraft fee waivers.)
“We’re talking about billions of dollars every single year being drained, disproportionately from Black and brown communities”When asked what the agency is doing to assist consumers who’ve been charged excessive overdraft fees, a CFPB spokesperson said, “Overdrafts have the potential to be very costly for consumers, and we are continuing to closely monitor developments in this area.”
But as consumers file complaints or seek low-cost bank accounts on their own, advocacy groups and lawmakers have pushed for more restrictions on overdraft fees. On June 30, Rep. Carolyn Maloney (D-NY) introduced the Overdraft Protection Act of 2021, a bill that aims to regulate the marketing and charging of overdraft fees at financial firms. During a House Committee on Financial Services hearing on July 21, Borné provided a statement on behalf of the Center for Responsible Lending calling for Congress to hold regulatory agencies like the CFPB to protect consumers from harmful overdraft fee practices.
“What to me is especially frustrating is that financial inclusion is all the buzz in a lot of circles. I feel like in a lot of these conversations people just try to talk around the elephant in the room, which are bank overdraft practices,” said Borné. “We’re talking about billions of dollars every single year being drained, disproportionately from Black and brown communities, and kicking people out of the banking system, eroding trust in banks. It’s just a huge barrier to real financial inclusion.”
While making digital the main channel of customer engagement, banks are also looking to move beyond business as usual, says Amit Anand, a Vice President in Cognizant Consulting’s Banking and Financial Services.
COVID-19 made online channels indispensable for bank customers, including those who preferred in-person banking. This accelerated their digital strategies and created an opportunity to go beyond the basics and become partners in their customers’ pursuit of financial wellness.
As banks bet big on digital, they are looking at technologies such as AI, advanced analytics, and automation to provide personalization, prediction and speed in creating powerful customer experiences. Banks are also increasingly relying on machines to automate repetitive tasks and make complex decisions, creating demand for human skillsets that complement intelligent machines.
Cognizant’s Center for the Future of Work (CFoW), working with Oxford Economics, recently surveyed 4,000 C-level executives globally, including 287 senior banking and financial services executives to understand how banks are adapting to fast and dramatic changes.
The earliest forms of digital banking trace back to the advent of ATMs and cards launched in the 1960s. As the internet emerged in the 1980s with early broadband, digital networks began to connect retailers with suppliers and consumers to develop needs for early online catalogues and inventory software systems.
By the 1990s the Internet became widely available and online banking started becoming the norm. The improvement of broadband and ecommerce systems in the early 2000s led to what resembled the modern digital banking world today. The proliferation of smartphones through the next decade opened the door for transactions on the go beyond ATM machines. Over 60% of consumers now use their smartphones as the preferred method for digital banking.
The challenge for banks is now to facilitate demands that connect vendors with money through channels determined by the consumer. This dynamic shapes the basis of customer satisfaction, which can be nurtured with Customer Relationship Management (CRM) software. Therefore, CRM must be integrated into a digital banking system, since it provides means for banks to directly communicate with their customers.
There is a demand for end-to-end consistency and for services, optimized on convenience and user experience. The market provides cross platform front ends, enabling purchase decisions based on available technology such as mobile devices, with a desktop or Smart TV at home. In order for banks to meet consumer demands, they need to keep focusing on improving digital technology that provides agility, scalability and efficiency.
Seven Ways to Capitalize on Digital
Institute front-to-back digitization. Banks can effectively compete with fintech competitors by becoming digital institutions.
Explore new customer segments and business paradigms. Digital makes it easier than ever for banks to explore small business segments, even as they pursue existing markets.
Emphasize platform centricity and smart aggregation. Open banking standards can help banks to provide personalized products to customers in collaboration with third-party providers and fintechs.
Invest in personalizing the customer relationship. Banks should use personalized experiences to make customers’ lives as frictionless as possible.
Focus on re-building trust and resiliency. Banks need to eliminate any biases in decisions made by machines.
Enshrine inclusivity into your digital strategy. Banks should use digital to reach customers who are left out by being physically and cognitively challenged.
Balance machine-driven and human-centric work. Create sturdy human-machine collaboration by reevaluating jobs for a shared environment.
Amit Anand is Vice President and North American Practice Leader for Cognizant Consulting’s Banking and Financial Services. Amit has 20 years of experience with firms such as Accenture, Infosys and Cognizant. He has successfully led and managed large business transformation, digital and IT transformation, and associated organizational change management for several financial services clients. Amit is a recognized thought leader with more than 15 publications on topics such as Open Banking, Digital 2.0 and new-age operating models. He can be reached at Amit.Anand@cognizant.com
Manish Bahl leads the Cognizant Center for the Future of Work in Asia-Pacific and the Middle East. A respected speaker and thinker, Manish has guided many Fortune 500 companies into the future of their business with his thought-provoking research and advisory skills. Within Cognizant’s Center for the Future of Work, he helps ensure that the unit’s original research and analysis jibes with emerging business-technology trends and dynamics in APAC, and collaborates with a wide range of leading thinkers to understand and predict how the future of work will take shape. He most recently served as Vice President, Country Manager with Forrester Research in India. He can be reached at Manish.Bahl@cognizant.com
What is a Bitcoin ATM, and does it actually function as an ATM? The short answer is yes.
Technically, these aren’t traditional ATM’s (Automatic Teller Machines) as they do not allow physical withdrawals of BTC from an account you own. Instead, these machines will enable you to purchase Bitcoin, depending on the specific machine. There are a number of machine types around from various companies, the top 3 being: General Bytes, Genesis Coin, and Lamassu.
You verify your identity through an one-time-password sent to your mobile or email. Again, this varies from machine to machine.
You decide if you want to buy or sell BTC (if you have the option).
To buy, you must choose the amount you want to in terms of BTC or your target fiat currency.
You then deposit the fiat currency into the machine.
Several things may happen depending on the machine:
A QR code may appear on the screen for you to scan
A QR code may be printed off corresponding to your new BTC wallet.
The machine will ask and scan the QR code of your pre-existing wallet.
You input your email address to have a QR code sent to you.
To sell, you must send the appropriate amount of BTC to the address displayed on the screen. Once the transaction is confirmed, you will receive the agreed fiatsum. How long this takes depends on the machine.
Bitcoin ATM’s v.s Crypto Exchanges
Bitcoin ATM’s are connected to exchanges. When using one, you are essentially buying or selling your chosen coin on an exchange. However, you’re interacting with a physical machine in a specific location rather than online. The price difference between using an online exchange and an ATM is generally around 5-10%. This means that ATMs cost 5-10% more to buy, and selling means you receive 5-10%.
Despite the premium that must be paid, many are attracted by these machines’ convenience and ease. They allow for a more visual and straightforward financial transaction that most are already familiar with. In addition, machines do not require any confusing registration processes or the need to learn about online trading interfaces.
When selling through an online exchange like Phemex, the platform’s spot marketsoffer more control over the price you are transacting with. You can also take advantage of limit orders and stop orders if you are not happy with current market prices.
There are many services and locations apart from bitcoin ATMs which provide exchange of bitcoins for cash and vice versa.You can send cash-to-cash payments to your relatives or friends in other countries by using two bitcoin ATMs. Find where to buy or sell bitcoins and other cryptocurrencies through ATMs for cash here…
Using an ATM isn’t risk-free, but there’s a lot of security already. milicad/shutterstock.com
2. What security issues do ATMs have?
Hidden cameras also let thieves watch users enter their PINs. A recent study found that a thermal camera can also capture PINs, by identifying which number keys are slightly warmed, because they were pressed by the user. Specifically, the researchers found that PIN detection accuracy could be up to 78 percent when the heat traces on the key pad are captured within 30 seconds of authentication.
The ATM’s telecommunications connection offers another means of attack. By intercepting communications between the machine and the bank, an attacker can collect useful card and account data. That may also offer a way to remotely install malicious software and take control of the machine itself: for instance, to issue commands to dispense cash.
5. How can new technology make ATMs more secure?
