Repeated Expenses

A typical Korean ATM of the type seen all across the country.
A typical Korean ATM of the type seen all across the country.

 

Major Korean banks are actively seeking to strengthen security of automatic teller machines (ATMs), since most ATMs still run Windows XP. Microsoft’s official support of the aging operating system (OS) ended as of April 8, and thus it has become more vulnerable to hacking or security attacks. However, the replacement of Windows XP with Windows 7 and the upgrade of the existing security solution for ATMs would cost a huge amount of money. Even with the upgrade, security problems cannot be solved completely. Therefore, Industry analysts are saying that it is necessary to come up with a measure that can fundamentally address the problem.

According to sources in the financial industry on June 11, major local banks are working to provide security updates for ATMs mainly in the metropolitan area. More than 95 percent of bank ATMs in the nation are based on Windows XP, which must be replaced with Windows 7 in the near future.

Despite consistent warnings about security threats for Windows XP, local banks plan to gradually conduct security upgrades in line with the service life of each ATM. The plan is attributable to the fact that most ATMS are operated using a closed network separated from th Internet. Moreover, an independent   security system is used for their ATMs. 

ATMs that are being upgraded at the moment are already fitted with Windows 7. Notwithstanding the installation of Windows 7 on those devices, only security solutions for Windows XP were available in the past. Furthermore, some problems with Windows 7 application compatibility caused the banks to downgrade some ATMs from Windows 7 back to Windows XP. Hence, the switchover from Windows XP to Windows 7 is currently under way. 

An industry source said, “Most of the ATMs in the country are said to be based on Windows XP, but Windows 7 is already installed on nearly half of them,” adding, “We are working to switch software from Windows XP to Windows 7. The work does not cost any extra money, because it is not necessary to replace the existing OS with a new one. So, there will be no burden of replacement costs. And also, it is possible to strengthen ATM security with minimal cost.”

The problem is outdated ATMs that need Windows 7. These old devices account for half of all ATMs, and thus banks ay have to buy ATM hardware itself.

An industry source remarked, “Leaving aside the issue of upgrading from Windows XP to Windows 7, the replacement of existing components of a security solution with new ones would cost billions of won.” The source added, “The replacement work would cost a lot of money, since all the work needs to be done in one or two years.”

In particular, upgrading to Windows 7 and replacing components only guarantees another four or five years of service. Experts are saying that the biggest problem is that once Microsoft’s technical support for Windows 7 eventually ends, the same kind of work will be needed again. An official at a financial company pointed out, “The phenomenon that the end of a specific firm’s technical support generates a big problem for all financial devices seems to be wrong.” The official concluded by saying, “But there is no choice but to upgrade to Windows 7.”

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