A total of 95,402 cases of UPI digital payment-related frauds have been reported in the current fiscal year up to February 23, 2023, the government has told Parliament. This is higher than a total of 84,274 cases reported in the financial year 2021-22 and 77,299 during the previous year, the government data shows.
"NPCI has informed that though UPI ecosystem has inbuilt security features, minuscule percentage of users get cheated over social engineering calls," minister of state in the ministry of finance, Bhagwat Karad, told the Rajya Sabha.
Despite the number of frauds being high, the fraud to sales ratio in value terms stood at 0.0015% in FY23 so far; 0.0016% in FY22; and 0.0017% in FY21, he said.
To safeguard customers from UPI frauds, the minister said UPI has a concept of device binding wherein the mobile number of a user is bound with his mobile device, making it "impossible for anyone to interject".
"Additionally, the user requires his debit card credentials and finally an OTP for UPI PIN creation to facilitate linkage with his/her bank account to the UPI app," he added.
Also, UPI apps provide an in-app intimation if a user is initiating payment to an unknown beneficiary. It also verifies the end beneficiary name to the remitter, while making payment giving a clear indication to whom the money is being transferred. The pin page of UPI also displays a message that by entering a UPI pin, he/she is transferring money to someone else, the minister clarified.
The government has also come up with the National Cyber-crime reporting portal wherein a user can register his grievance instantly by calling on 1930. "This helps in holding payments at the beneficiary Banks’ end if reported instantly."
The UPI platform as part of ‘India Stack’ has been hailed by countries across the globe. Prime Minister Narendra Modi during his post-budget webinar on ‘Enhancing Efficiency of the Financial Services for Creating Growth Opportunities' this month said UPI and other financial tools like Rupay are not just a "low cost and highly secure technology, but it is our identity in the world". "There is immense scope for innovation. UPI should become a means of financial inclusion and empowerment for the whole world."
Shaktikanta Das, the Governor of the Reserve Bank of India (RBI), this month said the daily UPI transactions crossed 50% in the past 12 months to 36 crore. In terms of value, transactions grew 17% to ₹6.27 lakh crore in the past 12 months, he said.
The total value of UPI transactions in the country has grown manifold in recent years. The cumulative value till February this year stood at ₹125.10 lakh crore, up from ₹84.17 lakh crore in FY22 and ₹41.03 lakh crore in FY21, Karad said in the Rajya Sabha.
On countries adopting UPI invented by India, the minister said BHIM UPI QR currently has gained acceptance in Singapore, UAE, Mauritius, Nepal and Bhutan.
Notably, NPCI International Payments Limited (NIPL), a wholly-owned subsidiary of the National Payments Corporation of India (NPCI) is devoted to the internationalisation of UPI.
