Rising UPI and credit card fraud, 60% of them going unreported
The best way to prevent financial fraud in current circumstances is to exercise caution
New Delhi: In May, India saw nearly 14 billion transactions conducted via UPI. This indicates that on an average every Indian made about 10 transactions per month. This figure highlights the popularity of UPI. However, alongside this popularity, incidents of digital fraud in the country are also increasing rapidly.
LocalCircles Survey
Over the past three years, approximately 47% of Indian families have fallen victim to financial fraud, according to a survey by LocalCircles. The majority of these cases involve UPI and credit card fraud. Shockingly, 60% of those affected do not report these incidents to regulators or security agencies. Moreover, if the fraud amount is less than Rs 1,000, 90% of people do not even lodge a complaint. Security agencies face significant challenges in effectively tracking and taking action against fraud. Due to this underreporting, highlighting a notable lapse in their functioning.
The survey also shows that around 43% of credit card users experienced financial fraud cases. This involves unfair charges during transactions on websites or in stores.
Use of credit cards
The use of credit cards in the country is rapidly increasing. RBI data shows an increase of 18.26 trillion rupees in credit card spending in the fiscal year 2024. This is 27% higher than the previous year. The number of credit cards issued has also crossed 100 million. However, this surge in credit card usage is also accompanied by an increase in fraud cases.
On the other hand, UPI transactions in India have seen significant adoption among the population. According to NPCI, in May 2024 alone, there were over 14 billion transactions through UPI, marking a 49% annual increase. Transactions during May alone exceeded Rs 20 lakh crore.
Fraud while doing UPI transaction
The LocalCircles survey further reveal data of past three years. 46% of people have been victims of fraud during UPI transactions. Forty one per cent of the affected individuals reported being deceived by links or QR codes sent to accept payments. This resulted in deductions from their accounts instead of receiving payments. Furthermore, individuals posing as bank representatives deceived 32% of people into disclosing their OTP and UPI PIN details. While 24% suffered from UPI PIN hacking scams.
The survey suggests several measures to combat financial fraud, including raising awareness among people and implementing stronger security measures. It also emphasizes the need for an easy platform for reporting incidents of fraud. This could aid agencies in better understanding and preventing such occurrences.
In conclusion, the most effective and straightforward way to avoid financial fraud in current circumstances is to remain cautious. Do not click on links or QR codes sent by unknown individuals and avoid falling for enticing monetary offers.