MANILA, Philippines - Around 80% of the total ATM system in the country is already compliant with the "end-to-end triple data encryption standard (3DES)", according to the Bangko Sentral ng Pilipinas.
"Most of the new machines being installed now are 3DES. Based on our estimates, of the total ATMs today, around 80% are already 3DES-compliant to begin with. So there's the smaller component that needs to make this migration by 2015," BSP deputy governor Nestor Espenilla told ANC.
The BSP had recently approved the Enhanced Information Technology Risk Management Framework last August 1. As part of the framework, banks are required to adopt the 3DES in their ATMs nationwide by January 2015, and to replace ATM cards with EMV-enabled ones by January 2017.
While the risk of ATM fraud is not yet that high, Espenilla said "the recent trend shows that this level of risk is escalating." "Other markets are now more secure so criminal elements would be going to less defended markets. We cannot afford to be behind," he added.
As for the shift to EMV-enabled cards, Espenilla said the BSP is giving lenders more time because of the costs involved.
"We are allowing for a bit more time because there is a cost involved in the migration process. If you look at the world today, although most of Asia would now have moved to chip-based card technology, major markets like the US are still on magnetic cards... It's a balancing of the costs versus the fraud risks that are potentially being mitigated," he said.
However, he noted a number of big banks are already moving to chip-based technology as early as now.
Espenilla said the two measures are part of a broader reform process being implemented by the BSP, "to upgrade the way the banks and other BSP-supervised institutions to manage their IT risks."