This article shows that the current generation of ATM's can easily
accommodate talking ATM functionality, whether now or later.

Kelly


    Banks Prepare For ATM Upgrades

    InformationWeek

March 8, 2004

    Banks Prepare For ATM Upgrades

    Mandates from Visa U.S.A. and MasterCard will require banks to increase
encryption security on ATM machines.

    By Steven Marlin,
InformationWeek



    Banks are in the midst of upgrading or replacing their automated teller
machines to comply with new industry and government standards. Visa U.S.A.
and MasterCard International have mandated that by April 1, 2005, all ATMs
must be equipped to handle triple-DES (Data Encryption Standard), a method
of scrambling personal identification numbers.

    Banks for years have employed single-DES encryption, which specifies a
key length of 56 bits; the triple-DES method uses a key length of 168 bits,
making it more difficult for a hacker to crack personal identification
numbers.

    Banks have the choice of either replacing or upgrading their fleets of
ATMs. Replacement is costlier; a new machine with triple-DES software costs
between $30,000 and $40,000. Existing machines can be upgraded with a minor
software modification but there's a catch--only machines less than five
years old are upgradeable; anything older will have to be scrapped.

    Susquehanna Bancshares Inc., a Pennsylvania-based bank, is replacing
its 160-machine fleet with new ATMs from Wincor Nixdorf Inc. including cash
dispensers and through-the-wall and drive-up ATMs. The bank had both the
DES requirement and an impending governmental regulation on its mind when
it made the decision to upgrade: Congress is expected to add a provision
under the Americans with Disabilities Act stipulating that ATMs be equipped
with voice technology for the visually impaired.

    The triple-DES and expected ADA requirements "gave us an opportunity to
examine how to meet the security and compliance needs of an integral part
of our distribution network," says Greg Duncan, Susquehanna's chief
operating officer.

    The machines, which will include both triple-DES and voice technology,
come equipped with Passport switching software from banking-software
provider Jack Henry & Associates to connect the ATMs to regional debit
networks. IBM, through its Global Services division, is integrating the new
ATMs with the rest of Susquehanna's branch network system.

    The machines are providing an opportunity for Susquehanna both to
extend its brand and reduce costs. For example, the machines will be
HTML-compliant, allowing the bank to provide the same look and feel across
its retail distribution channels--branch offices, ATMs, call centers, and
Web banking. And they'll be capable of capturing images of checks, enabling
Susquehanna to send them electronically to the paying bank instead of
shipping boxes of paper; that's been legalized through the Check Clearing
for the 21st Century Act, also known as Check 21, which takes effect in
October.


    Copyright © 2003 CMP Media LLC


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