Archive for October, 2012

Cash Retraction ends in India

October 10, 2012 Leave a comment

India’s ATM users may need to pay closer attention to their ATM transactions from now on. In response to a National Payments Corporation of India’s request, the Reserve Bank of India has told banks to shut down cash-retraction facilities at their ATMs.

The Retraction facility means that cash not picked up by the customer after 10-15 seconds was sucked back into the ATM and the customers account was credited again.

The Times of India reported that the NPC request came in the wake of a major ATM swindle. In the scheme, an individual would make a withdrawal, leaving a few notes for the cash machine to retract. Then the customer would report to the bank that the ATM had taken back the entire amount. Using this ploy, a gang of at least six men carried out a fraud operation that netted more than $350,000 in ill-gotten funds.

Banks have let customers know that henceforth, their money will not be retracted into the ATM if they forget to retrieve it. Instead, it will remain in the open for the next ATM user potentially to collect. Despite this, Indian banks told the BBC they believe the new policy will serve their customers’ best interests.

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