TAIPEI (Taiwan News) — Taiwan is expanding the use of AI-powered facial recognition ATMs to combat fraud, with the Financial Supervisory Commission reporting the technology has reduced fraudulent withdrawals in high-risk areas by 60%, per CNA.
ATM withdrawals are a critical point for preventing fraud, as criminal syndicates often send accomplices wearing helmets, face masks, or sunglasses to conceal their identities while withdrawing or transferring funds. Under the pilot program, AI-equipped ATMs detect face coverings and issue an audible warning to remove such coverings, potentially causing a two-minute delay for the transaction to continue. The transaction may be denied if the user's face remains obscured.
According to the FSC, 15 banks had deployed facial recognition warning systems at 1,594 ATMs as of the end of May, accounting for only a small portion of the more than 33,000 ATMs operating nationwide. FSC Chair Peng Jin-lung (彭金隆) told legislators earlier this month that deployment among state-owned banks currently exceeds 4% and is expected to reach 30% by the end of the year, per UDN.
Peng said the pilot program is intended to identify best practices that can be adopted more broadly across Taiwan's banking sector. He added that the Banking Bureau is collecting feedback, with the issue expected to be discussed in August.
Banking Bureau Director-General Tong Cheng-chang (童政彰) added that his agency is gathering feedback from participating banks before expanding the program. While the technology has shown promising results, some customers have raised concerns about the inconvenience, per UDN.
Tainan Police Chief Lin Kuo-ching (林國清) said that since the pilot program of AI-assisted anti-fraud ATMs, the number of cash withdrawals by fraud groups has decreased by 65.8% compared to the same period last year. He believes that collaboration with CTBC Bank will further improve the city's anti-fraud protection network, per a press release.
CTBC Bank said it has prioritized deployment of AI-powered fraud prevention technology at ATMs in high-risk areas. In addition to detecting face coverings, the system can identify frequent card switching and issue alerts to protect customers from password theft while entering PINs, per CNA.
CTBC said nearly 1,000 ATMs had the technology by the end of May, and program expansion will be based on operational performance and changes in fraud patterns. CTBC said several ATMs previously targeted by fraud rings have recorded no fraudulent withdrawals during the trial period.
The bank acknowledged that some customers initially found it inconvenient. However, transaction data indicates the warning system has had minimal impact on legitimate users, with most customers completing their transactions after following the prompts.
Cathay United Bank introduced AI-assisted facial recognition at selected ATMs in high-risk areas in mid-April. When the system detects a partially obscured face, customers receive visual and voice prompts asking them to remove masks or helmets. Transactions can continue after the user's face is fully visible or automatically resume following a two-minute waiting period.
The bank said about 80% of customers use ATMs without face coverings, while roughly 20% wear masks or helmets. Among those receiving alerts, approximately 95% removed their face coverings immediately, while the remaining 5% completed their transactions after waiting two minutes, per CTBC press release.
Bank SinoPac has adopted a different approach by installing facial-recognition access controls at its ATM service areas. Customers are only permitted to enter designated ATM zones after the system confirms their faces are fully visible, per a SinoPac press release.
As of the end of June, the technology had been deployed at 72 branches, with coverage expected to exceed 60% before the end of the year. The bank is also installing AI facial recognition cameras at outdoor ATMs and expects more than 40 units to be operational by year's end.
Chunghwa Post currently operates 46 ATMs with AI facial recognition out of a total of more than 3,100 ATMs throughout Taiwan. Depending on the results of the initial trial, the state-owned postal company will likely expand its use over the next few years.
