Digital payment frauds in India saw a more than fivefold jump to 14.57 billion rupees ($175 million) in the year ended March 2024 from the previous period, according to the Reserve Bank of India's annual report published Thursday.
The jump comes as India turns into a digital payments powerhouse since the launch of the Unified Payments Interface, or UPI, in 2016, which allows users to transfer money instantly using their mobile phones. RBI data shows that the value of transactions on UPI jumped 137% in the past two years to 200 trillion rupees. Cheap access to the internet along with greater financial inclusion have also led to an increase in digital payments across the country.
The growing popularity of digital payments creates a bigger target for fraudsters, said Nikhil Jois, head of growth at fraud detection platform Bureau. “Coupled with a lack of financial literacy and imprudent use of technology, vast population is rendered vulnerable to such attacks,” he said. “Fraudsters are getting sophisticated by the day, while financial institutions and fintechs, jostling for market share and growth, have loosened controls.”
The central bank has launched several high profile campaigns to make consumers aware of financial frauds including advertisements where Bollywood star Amitabh Bachchan is seen alerting users to be aware of the risks when transferring money online.
Digital payments including cards and internet transactions made up 10.4% of the total fraud amount, up from 1.1% in fiscal 2023.
© 2024 Bloomberg L.P.
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