Unified Payments Interface (UPI) fraud cases surge by 85% in FY24: Ministry of Finance

Posted 29 Nov 2024

2 min read

Since 2022-23, UPI-related frauds have accounted for a cumulative loss of ~Rs 2,100 crore across 2.7 million reported incidents.

Rise in UPI-related frauds coincides with growth in number of UPI users and total transactions.

Types of UPI Frauds

Phishing Attacks: Most common fraud, Cyber attackers employ phishing emails, messages to lure users.
Malware Attacks: Smartphones can be infected with malicious software that compromises UPI transactions.
Social Engineering Fraud: Fraudsters exploit users’ trust, creating a sense of urgency or fear to extract sensitive information.
Vishing or Voice Phishing: Using fake call pretending to be someone from bank officials or UPI service providers.

In FY24, UPI processed 131.12 billion transactions with a total value of Rs 200 trillion. Currently, UPI is used by over 400 million unique users for real-time payments.
Rise of financial frauds by 166% in 2023-24 compared to 2022-23, as per RBI annual report.

Cyber-security: Digital financial frauds accounted for a staggering ₹1.25 lakh crore over last three years as per Indian Cybercrime Coordination Centre.
Third party risks: This can be risk from Dominant Internet platforms or Digital banking solution providers.
Digital Illiteracy: 37.1% of urban population is able to use internet as compared to only 13% in rural areas.
Other Challenges: Limited digital infrastructure. Interoperability issues etc.

Indian Cybercrime Coordination Centre (I4C): Under MHA, to combat cybercrime
CERT-In: national nodal agency for responding to computer security incidents.
PMGDISHA: To usher in digital literacy in rural India.
Cyber Swachhta Kendra: To create a secure cyber space by detecting botnet infections.