Kenyan Banking Industry Upgrades ATM network to Increase Security

The Kenyan banking industry has successfully upgraded its Automated Teller Machine (ATM) network following an industry wide initiative that was spearheaded by the Kenya Bankers Association (KBA), the industry umbrella body. In an effort to enhance ATM security in the country, KBA members have adopted the global standard known as EMV, which is based on chip and pin technology and provides more security features than traditional systems.

According to the KBA, member banks were required to certify their ATMs as EMV-compliant by 30th September, 2013. The annoucement was made earlier in the year, and was a critical step in a process that will enable the industry to curb the rising cases of ATM-based identity theft and fraud, commonly known as ‘skimming’.

“ATMs are an important part of the payment system and provide the banking public with a convenient option to access their cash, we therefore are very pleased that our members have supported this effort and continue to invest in enhancing their systems,” said KBA Chief Executive Habil Olaka.

“We have achieved the target we set with more than 96 per cent of the ATMs in the market having been upgraded, and the remaining machines being earmarked to be certified or phased out before the end of the year,” said Mr. Olaka.

Mr. Olaka added that theprocess of certification and replacement of hardware took longer than KBA had anticipated, and as a result the Association in consultation with other industry players adjusted the migration timelines. “We are happy that the first phase has succesfully been concluded and are working with the member banks on the next two milestones,” he said.

Mr. Olaka noted that some of the issues faced by banks included the extensive EMV certification process; and challenges with suppliers fulfilling the requirements in the earlier stipulated timelines. As a result, KBA phased the EMV implementation into three stages:

• ATM Migration – 30th Septemberas the date for all bank ATM machines to be EMV compliant;

• POS Migration – 31st December 2013 as the date for all bank Point of Sale (POS) terminals to be EMV compliant; and

• Card Migration – 31st March 2014 as the date that banks should replace all magnetic stripe ATM, debit and credit cards with EMV Compliant Pin & chip technology cards.

Background

EMV is an international standard that was developed by the leading card operators Europay, MasterCard and Visa to ensure security of card systems and ease of payment globally. The Kenya Bankers Association announced the migration to EMV in April 2013 in conjunction with the KBA-sponsored National ATM Safety Awareness Month. The awareness campaign dubbed ‘Kaa Chonjo!’ was introduced by KBA in 2012 in response to the rising cases of ATM-based fraud.

Although the campaign is observed once a year, KBA advises its members and the banking public to continually be ‘Chonjo’, including during the festive season and peak periods such as back-to-school, when perpetrators of fraud expect bank customers to have extra cash and transact regularly at the ATM.

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