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ATM skimming: What it is, how it happens, and how to spot it

The number of compromised debit cards nearly doubled in 2023. Here’s how to protect yourself.

Yahoo Personal Finance· Getty Images
Ivana Pino
·Senior Writer
Updated 4 min read

When you insert your debit card at an ATM or swipe it at a store, you may not realize you’re potentially at risk of becoming the target of ATM skimming.

According to a recent FICO report, there was a significant increase in compromised ATM cards resulting from skimming activity in 2023. The total number of compromised debit cards was up 96% from 2022, with more than 315,000 impacted cards identified.

So what is ATM skimming, exactly? And how can you protect your sensitive information and money from ATM skimmers? Read on to find out.

ATM skimming happens when someone gains access to your debit card information via an ATM or card payment terminal using a special device installed on the card reader. These devices can capture your name, debit card number, security code, PIN, and more.

Financial institutions have been combating ATM skimming by implementing safeguards such as EMV chips and tap-to-pay technology. Even so, skimming is still a prevalent issue. In fact, more than 3,500 financial institutions were affected by card skimming in 2023, according to FICO.

Read more: 6 important security features to look for in a bank

ATM skimming tends to occur at locations with high debit card use. This includes ATMs, gas station pumps, and any other point-of-sale terminals where you may insert your card.

ATM card skimmers use various tactics to gain access to your personal information. Some of the most common methods include:

  • Attaching a skimming device to an ATM or payment machine that reads and records your card information.

  • Strategically placing a camera near the machine to record you as you enter your information.

  • Placing an overlay on a machine’s PIN pad, which records your information as you type it.

ATM skimmers collect and use this information to access the funds in your checking account, make unauthorized purchases, or even open new, fraudulent accounts in your name.

Read more: 7 common banking scams (and how to avoid becoming a victim)

Anyone with a debit card can fall victim to ATM skimming. However, there are ways to spot the signs ATM skimming. Here are some key habits to adopt to better protect your money:

  • Check the payment machine you’re using: Often, taking a close look at an ATM or payment terminal before using it can help you spot whether there’s anything off about it. Check for signs of tampering, such as a loose or damaged card reader, tape or glue on the machine, or an unusually thick PIN pad.

  • Use contactless payments when possible: Using tap-to-pay or a digital wallet such as Apple Pay or Google Wallet can be a safer option than inserting your card into a reader. These forms of contactless payments encrypt your card information so that it can’t fall into the wrong hands. If contactless payments aren’t an option, inserting your card into a chip reader can be a safer alternative to swiping your card and potentially revealing your card’s magnetic stripe to fraudsters, as the stripe holds key data, including your name, card number, expiration date, and card verification code (CVC).

  • Cover the PIN pad when typing: To protect against any hidden cameras, use your hand to cover the keypad as you type in your PIN.

  • Avoid non-bank ATMs: FICO reports that 65% of card skimming incidents take place at privately owned non-bank ATMs. You might find these machines at a convenience store, bar, restaurant, or salon. If you need cash in a pinch, consider using your bank’s branch or ATM locator to find a nearby location.

  • Monitor your account for suspicious activity: Make it a habit to regularly review your bank statements for any activity you don’t recognize. If you notice any fraudulent charges, dispute them right away with your bank.

  • Set up account alerts: Many banks allow you to create email or text alerts so you can catch suspicious activity in your account. For example, you may want to be alerted to transactions over a certain dollar amount. Take a moment to review your notification settings and adjust them so that if you do fall victim to card skimming, you can find out as soon as possible and notify your bank.

Read more: Is mobile banking safe? How to keep your personal data secure