ATM cards, which offer functions such as account inquiry, cash withdrawal, payment of tax, and account transfer, have become an indispensable payment instrument in our daily life. However, since it involves the transfer of money, ATM cards have increasing become the target of attacks. Because magnetic stripe cards are easy to be duplicated, fraudulent withdrawals occur frequently. At present, the cross-bank transactions of magnetic stripe cards are not allowed in Taiwan and magnetic stripe cards were replaced by chip cards. Besides the inherited functions from magnetic stripe cards, chip cards also offer functions such as web-ATM payment and payment at real stores. Chip cards make it possible to determine the authenticity of a card and verify the identity of a user by using offline password verification, which greatly enhances the safety of ATM cards.This study first investigates the characteristics, evolution and ATM card fraud incidents; and then analyzes the security of magnetic stripe cards and chip cards. Finally, an improved solution for chip cards is proposed. The results are provided as a reference for financial industry and cardholders.