Cut the risk of withdrawal disputes with self-service management tools

By : Lisa Kellermeyer

October 17, 2017 12:00 PM

There are many compelling reasons for financial institutions to invest in solutions to efficiently manage the self-service channel. One of the most powerful of all is to have completely visibility into ATM activity for effective cash and transaction balancing.


This reduces the risk of customer disputes and can also help to combat ATM withdrawal fraud. Recent figures have emphasized just how big an issue this type of fraud has become, particularly in the US.


A $20m problem?
A study commissioned by the ATM Industry Association (ATMIA) and authored by Tremont Capital Group found that the financial impact of ATM withdrawal fraud in the US has reached $20 million a year. The research showed that approximately 20 to 25 percent of withdrawal disputes are fraudulent.


One of the factors in this trend is the fact that US regulations stipulate certain time restrictions for consumers to file a claim over a withdrawal and for the ATM operator to respond. This is typically around 180 days for the consumer and six days for the operator.


Most fraudulent claims relating to independent ATMs come in more than 90 days after the event, but many machines have a 90-day journal. As a result, it is not possible for the operator to dispute the claim without conducting an investigation that would take longer than six days.


Furthermore, potentially suspicious patterns such as multiple withdrawal claims on a single card often go unnoticed at independent ATMs. When this sort of trend occurs on a bank-owned ATM, it is likely to lead to account closure or card reissuance.


ATMIA has responded by planning an investigation into this particular problem and is set to work with networks, issuers and processors to find a solution.


David Tente, the trade association's US executive director, said: "[Withdrawal disputes have] become a $20 million annual problem for the industry. ATMIA is reaching out to the ATM networks, processors and issuers for their cooperation in creating a strategy to reduce this type of fraud."


Protect your business
Equipping your business with the right tools and solutions in the self-service channel is one of the most effective ways to manage problems such as ATM withdrawal disputes, while delivering operational benefits for the company and a better experience for the customer.


Electronic journals can make a big contribution to security and efficiency in this channel by providing a record of all ATM activity, including transactions, settlement information, cash-related events and any critical hardware or software occurrences.


Access to electronic journal data puts you in a stronger position to quickly resolve customer disputes, reducing the risk of fraud for the business and delivering a better service to consumers whose disputes are genuine.


There are similar advantages to be gained from cash and transaction balancing. Rather than relying on manual reconciliation of cash balances and ATM transaction data, financial institutions can now automate a large part of this process, which reduces the risk of human error and gives branch staff more time to concentrate on valuable, revenue-generating activities. It also guarantees a better service for customers who expect their disputes to be resolved quickly.


Solutions such as these deliver an attractive range of benefits and - with the ATM continuing to play a vital role in the delivery of financial services in the US and globally - look set to become increasingly important in the years to come.

Lisa Kellermeyer

Global Marketing Manager

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Lisa Kellermeyer is a Global Marketing Manager for Management Solutions, based at NCR's World Headquarters in Duluth, GA. Lisa is responsible for the marketing of NCR's Financial Device and Transaction Management portfolio.