Starting on October 1st many people traveling and living in Bali, suddenly found they could no longer withdraw cash from ATMs in Bali using their ATM card. With no news or announcements from the banks, various theories started to spread around the internet about what was or still is, causing the problem.

ATM EMV problem in Bali

This sign was seen posted on all Mandiri bank ATMs

Some of the theories include:

– banning of foreign cards
– blocking of Indonesian ATMs by foreign banks because of continual problems with fraud
– currency control by the government
– change in security chip
– telecommunications’ problem

Now I am not a banking expert, but I am interested in anything related to finance and in a previous life even worked at a bank. So I have tried to research the reason for the current trouble.

The problem seems to be limited to withdrawing money from ATMs using VISA debit and credit cards. You might think your debit card is not a VISA card, but if it has the Plus logo on it, that is an interbank network operated by Visa. The interbank network allows you to withdraw money from another bank’s ATM, even when traveling overseas. Cirrus is another interbank network operated by Mastercard, which incidentally does not seem affected by the current trouble.

ATM fraud or “skimming” has become a major problem for banks, which I have discussed previously on this site. Banks have lost billions of dollars to this crime, so it is not surprising financial institutions wanting to do something to improve security.

One of the technology developments to increase security, has been the development of cards with EMV enabled chip cards. EMV stands for Europay, Visa, Mastercard – the three companies who created the standard. The chip enables data to be stored on an integrated circuit rather than the usual magnetic strip, ATM cards have long used. The EMV chip is more secure and supposedly impossible to clone.

The problem is that banks have been slow to move implement the technology in their ATMs. To encourage banks to upgrade, Visa have stated they will no longer accept liability for any loss caused by ATMs that do not accept EMV chip cards. The deadline was set to October 1st for banks in the Asia Pacific region, which is of course when people started reporting the problem.

So it seems rather than face the liability of any potential ATM fraud, the banks in Indonesia have blocked access to Visa debit and credit cards. It could it also be that Visa themselves have blocked access, until the ATMs have been upgraded. There was an article in the Jakarta Post on April 6 of this year, detailing how banks would like miss the implementation deadline:

Out of 13 card vendors, nine have been certified to produce the new cards, data from ASPI reveals. Meanwhile, only three out of six ATM vendors and two EDC vendors have obtained certification to upgrade or provide the new machines.

But of course this doesn’t help if you are stuck here in Bali with no money. If you have a Mastercard or debit card on the Cirrus network, you could try that. Some people on various forums have also reported being able to withdraw money from CIMB Niaga and BRI ATMs.

Please note this is information I have compiled from the web and I unfortunately don’t have access to any “inside” information from the banks themselves. I have emailed Visa, but yet to get a reply. If anyone has information to share, please leave a comment below or drop me an email: