The European Union changes the rules on the usage of ATMs. There will be fresh limits

The European Union announces crucial changes to the usage of ATMs and payment systems throughout the Community. The fresh rules, although inactive in the negotiation phase, are primarily intended to increase client safety and transparency of cash withdrawal charges. The introduction of these can mean crucial changes in the regular habits of users and challenge banks and financial institutions.

Real-time verification of IBAN identity and number

One of the key elements of the announced improvement is the work to verify the identity of the account holder at the time of the transfer or withdrawal of cash. The strategy will check Account holder's name and IBAN number in real time, before the money is transferred or paid. The aim of this solution is to fight the phenomenon of the alleged phenomenon. spoofing – fraud of impersonating banks or another legal entities that mislead customers by forcing them to supply data or to carry out adverse transactions.

In addition, all payment institutions will be required to exchange information on fraud attempts. That's how it's going to happen. Common European Early informing Networkto improve the effectiveness of detection and prevention of unfair actions.

Greater transparency of fees and commissions

The improvement besides focuses on harmonising and making public all costs associated with the usage of ATMs and card payment systems. Under the fresh rules:

• Before the cash withdrawal is completed, the user must stay clearly informed of all applicable charges.
• If the operation involves conversion, the client will besides receive information about the applied exchange rate.
• A akin regulation applies to fees in consumer-company relations during card payments.

This solution is intended to let users to take informed financial decisions and prevent unpleasant surprises in your account.

Concerns about the banking sector – who will bear the cost of fraud?

Although most EU associate States support the proposed changes, the banking manufacture in Germany expresses crucial reservations. Representatives of Deutsche Kreditwirtschaft (DK) indicate that:

• Burdening banks with full financial work for the consequences of fraud may not reduce the number of crimes, but shift the burden of costs to financial institutions.
• Such a step can besides encourage fraud to usage fresh methods to bypass the safeguards.

Heiner Herkenhoff, CEO of the Bundesverband der Deutschen Banken (BdB), stresses that effective protection against fraud requires cooperation between banks, telecommunications operators and digital platforms. Only in this way is it possible to make a sustainable and effective defence strategy against financial crime.

What's next? Legislative phase and implementation perspectives

The proposals for amendments are presently in the negotiation phase with the European Parliament. It is only after all EU bodies have approved that the rules will enter into force. If this happens, these changes can radically transform the regular usage of ATMs and payment systems across the Union.

The fresh regulations will require banks and operators to adapt technologies and procedures to meet safety and transparency requirements. On the another hand, customers will gain more control over their finances, but they may besides encounter changes in the way they conduct transactions and possible delays resulting from additional verification.

Expert Analysis

The introduction of mandatory real-time IBAN identity and number verification is simply a step towards enhanced transaction security. However, as the banking sector points out, without the engagement of all stakeholders — banks, telecomas and digital platforms — full protection against fraud remains a challenge. Transparency of fees is another crucial component that can increase consumer assurance in payment systems.

These changes are part of the global trend in the increasing digitalisation of financial services and the request to better defend user funds from increasingly sophisticated forms of cybercrime.