People around the world are increasingly turning to their mobile phones to pay for everything from rent to restaurant bills, so it was only a matter of time before ATMs caught up. Some banks are installing cardless ATMs that don’t require debit cards to handle cash withdrawals, and while they promise security upgrades that fight some forms of ATM fraud, they also bring new vulnerabilities. Even if you don’t use cardless ATMs yourself, the transactions these machines enable can let thieves quickly convert a significant chunk of your bank balance into cash and take it for themselves with just a few key pieces of information. To help you protect yourself, we’ll explain how cardless ATM fraud works and what you should watch out for, so read on.
Even though cardless ATMs are starting to spread, with Wells Fargo alone installing 13,000 of the machines throughout the country in 2017, many people still aren’t familiar with them. Cardless ATMs connect to your bank account using an app instead of your debit card, letting you withdraw cash with just your mobile phone. When you want to make a withdrawal at a cardless ATM, the app will generate some sort of verification key, such as a QR code for the ATM to scan or a numeric code you can punch in. Once you enter that verification key and your PIN, the ATM will process the transaction and dispense your cash. Some banks have their own proprietary apps that work with cardless ATMs, while others connect with popular mobile wallets, such as Google Pay and Apple Pay.