Tuesday, July 27

RBI’s customer protection rules will benefit depositors

KOLKATA: The customer protection rules laid down by Reserve Bank of India two years back will ensure that no depositor will lose money in the series of ATM skimming fraud that has been reported in Kolkata over the last three days.

The banking regulator has made zero customer liability in case of contributory frauds or negligence or deficiency on the part of banks.

Senior bank officials said depositors will get their money back within seven working days as per the rules.

As many as 61 ATM frauds have been reported, mostly from Jadavpur area of Kolkata, where fraudsters used two ATM machines of Punjab National Bank to dupe customers. Fraudsters have withdrawn nearly Rs 14 lakh in several transactions made between November 28 and December 4, sources familiar with the development said.

The complainants used two ATMs in this locality and were duped include customers of HDFC Bank and United Bank of India.

“This is a clear case of skimming. Depositors will get back their money within seven days,” an HDFC Bank official said.

Neither of the two compromised ATMs have guards as several banks have stopped deploying security guards to save cost.

A senior official with State Bank of India said the bank is in the process of putting cash dispensation machines on electronic surveillance. SBI has about 3900 ATMs in the Bengal circle, while only 670 machines are so far put on e-surveillance. “We plan to put another 800 ATMs on e-surveillance in the next three month,” the official said.

Bankers said EMV chip cards are more secure than traditional debit and credit cards with magnetic strips but magnetic strips cannot be removed entirely as several ATM machines still cannot read EMV chips.

Account information stored on EMV chip cards is encrypted uniquely each time it is accessed, making it more difficult for fraudsters to pick up information. Magnetic stripes store data statically.

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