ATM fraud: Types of ATM fraud

ATM frauds: All you need to know to safeguard yourself.
ATM fraud: Types of ATM fraud
3 mins

Automated Teller Machines or ATMs have become the most convenient way to carry out quick cash transactions. It saves you from the hassle of visiting the bank. These machines are available everywhere, from shopping malls to offices to airports and stations.

Over the years, incidents of ATM fraud have increased. ATM fraud is basically the fraudulent activity of gaining illegal access to someone's ATM card and PIN to withdraw money from their account. Another kind of ATM fraud is breaking into an ATM and stealing money from the machine.

It is necessary to be aware of various kinds of ATM frauds and to safeguard oneself from being the victim.

ATM scams and frauds: Know more to stay safe

  • Skimming

    Electronically stealing data from an ATM card to imitate it completely, thus making unauthorised transactions from the victim’s account.

  • Shimming

    Installation of a small device called a shimming device on the machine that gathers magnetic information from the ATM card.

  • Cloning

    ATM card cloning is a type of phishing too. Cloning fraudsters primarily target elderly people who are not as aware and cautious regarding such scams and frauds.

  • Trapping

    Installation of a trapping device that makes an ATM card get stuck in the machine’s card slot. The scammer steals the card while the victim asks for help with getting it unstuck.

  • Keyboard jamming

    Fraudsters jam crucial ATM buttons, such as the ‘Enter’ or ‘Cancel’, to have the victim face an unsuccessful transaction. Scammers steal the card when the victim leaves to get assistance.

ATM card fraud: Preventive tips

  • Check the machine for any attached foreign or unrecognised devices.
  • Refrain from entering ATMs in desolated areas or without a guard.
  • Check for any hidden cameras.
  • Leave the premises if you see suspicious people lingering inside or around the ATM.

ATM skimming: Things to know

  • Fraudsters place a small device in the machine itself that steals the card’s data when swiped.

  • Scammers also place cameras inside the ATM to get the victim’s PIN.

How to know if there is a skimmer in the ATM

  • Inspect if the card slot is abnormally protruding outwards.

  • Examine if the keypad appears to be thicker than usual.

  • Check for tape or glue on the machine and a camera in the ATM.

How ATM skim works

ATM skimming happens using a skimming device, which has two parts:

  • One part is a small device that copies the card’s magnetic strip information placed in the machine.

  • The other part is a small camera that clicks photos of the victim while entering the PIN.

Tips to prevent ATM skimming

Follow these given tips:

  • Inspect the area in and around the ATM for anything suspicious.

  • Examine the machine and its keypad for unusual thickness or damage.

  • Keep the keypad covered while entering the PIN.

Reporting a skimming incident

Skimming victims should report the ATM fraud case to the bank’s customer care service centre immediately to block and replace the compromised card. Simultaneously, it is wise to buy a plan to safeguard you against such frauds like the Wallet Care plan through Bajaj Finance Insurance Mall.

While we speak about ATM frauds, it is also essential to let you know about the other types of frauds. This would make you more alert when you share or use your information online or with people who we are not acquainted with.

Credit card fraud

Credit card fraud occurs when a fraudster gains illegal access to an individual’s credit card number and PIN. The scammer can then use that information to make financial transactions on behalf of the victim.

Online fraud?

Any fraudulent activity committed over the internet is online fraud. These include online spam, scams, identity theft, financial fraud and more.

Phishing – Stay alert

Fraudulent practices committed to stealing confidential and sensitive information, such as card details, login credentials, or passwords are considered phishing. Phishing happens via electronic modes like texts or emails that seemingly originated from reliable companies but are from fraudsters.

About UPI and how to prevent UPI fraud

Unified Payments Interface (UPI) is a payment system that lets account holders from across multiple banks make instant transactions from their smartphones. With the high usage of the UPI, scammers have now started misusing the payment request option to source the PIN or OTP to authorise a transaction and do UPI fraud.

Preventive tips for UPI-related frauds

  • Never share OTPs or UPI PINs with anyone.
  • Do not open any unsecured links.
  • Verify payment requests.
  • Do not download dubious applications.
  • Be careful while scanning UPI IDs.

Data loss and prevention

Data loss refers to losing or compromising an individual's confidential data, wherein the data owner cannot access it.

With most of the data storage online now, implementing data loss prevention (DLP) is of utmost importance. Organisations and individuals are at risk of the following without DLP:

  • Other third parties also gain access to the lost data and, in future, may cause further problems.
  • Fraudsters can use stolen data to access more sensitive information, like financial details, and make unauthorised transactions.
  • Hackers can access the users' confidential information on the dark web.

Safeguarding against frauds with wallet & card protection plans

Wallet and card protection plans offered through Bajaj Finance Insurance Mall help you safeguard against financial liabilities arising from frauds. These plans have multiple benefits including taking care of your financial liabilities by paying the card issuer any outstanding bills up to the coverage amount on the cardholder's behalf.

These plans have made single-call card blocking, PAN replacement, 24/7 helplines, and emergency travel assistance possible.

When it comes to frauds, the best way to prevent them is to stay alert and make sure to be careful when you share any information online or otherwise. Another way to safeguard yourself is to choose one of our wallet and card protection plans and rest assured.

Frequently asked questions

How is ATM fraud done?

ATM fraud can be done in various ways, such as card skimming, card trapping, and cash trapping. Card skimming involves placing a device on the ATM that reads and stores the card information while the person enters their PIN. Card trapping involves a device placed inside the ATM that prevents the card from being released after a transaction. Cash trapping involves a device that holds onto cash after it is dispensed, allowing the fraudster to retrieve it later.

How to investigate an ATM fraud?

ATM fraud investigations involve analysing CCTV footage, examining fingerprint and DNA evidence, and analysing financial transactions to identify the perpetrators. The investigation may involve the bank, law enforcement, and the ATM manufacturer to gather evidence and track the fraudsters.

How is an ATM card misused?

ATM cards can be misused in several ways such as unauthorised withdrawals, PIN theft, and phishing. Unauthorised withdrawals occur when a fraudster uses someone else's card details to make cash withdrawals. PIN theft occurs when a fraudster observes or steals the person's PIN. Phishing involves tricking the person into revealing their card details and PIN through fake communication channels.

How do banks prevent ATM fraud?

Banks prevent ATM fraud through various measures, including card chip technology, two-factor authentication, and ATM location monitoring. Card chip technology provides an added layer of encryption to prevent skimming, while two-factor authentication requires a PIN and another form of verification, such as a biometric scan. ATM location monitoring involves tracking and analysing ATM usage patterns to detect unusual activity and prevent card skimming and other forms of fraud.

Show More Show Less


Bajaj Finance Ltd. (BFL) is merely a distributor of third party products from Assistance Services providers such as CPP Assistance Services Pvt Ltd, Bajaj Finserv Health Ltd.(BFHL), AWP Assistance India Pvt. Ltd. (Allianz), Doc Online Health India Pvt Ltd. etc. Issuance of the product is at sole discretion of Assistance Company or Services provider . The product and services or benefits assured under the product shall be governed by respective partner’s product T&C’s and BFL does NOT hold any responsibility for the issuance, quality, serviceability, maintenance and any claims post sale. Your purchase of an assistance product is purely on a voluntary basis after your exercise of an independent due diligence on the suitability, viability of any product. For more details on terms and conditions, inclusions and exclusions please read the product sales brochure carefully before purchase or subscription. All product information such as membership fees, benefits, exclusions, value added services, etc. are authentic and solely based on the information received from the respective value added service provider or Assistance company.

Note – While we have made all efforts and taken utmost care in gathering precise information about the products, features, benefits, etc. However, BFL cannot be held liable for any direct or indirect damage/loss. We request our customers to conduct their research about these products and refer to the respective product’s sales brochures before concluding their sale.