Digital identity verification can come with privacy issues. With increased use of digital and o...
There has been a definite shift in the way people bank and transact. Especially since the Covid-19 pandemic, the number of people using digital banking has increased significantly and with it has also increased payment frauds. We will be looking at this matter that has resulted in serious repercussions.
It is a term used to denote any form of false or illegal transaction which is executed by a cybercriminal. The increased instances of people making electronic transactions have also raised its occurrence where sensitive information of a user is stolen to steal money from them.
There have been increasing incidents of frauds as people have shifted to digital banking because of its convenience and other benefits.
Some of these frauds have been in the following forms:
As per a report there was increase in ransomware payments made by businesses. Spam attacks related to outbreak surged and work from home network configurations led to an increase in ransomware attacks.
Fraudsters have been using UPI to scam people. The modus operandi used by fraudster is that the hacker first sends a request money link to the user and when the user clicks on the link to authorize transaction in anticipation of money, the money gets debited automatically from the bank account. This way fraudster trick people and lack of awareness and information has led to this downfall.
OTP is another common method employed by fraudsters. One would know that in order to make transaction online, you may require PIN or an OTP i.e., One Time Password. For OTP your bank sends you an OTP on your registered mobile number through SMS. Once the OTP is verified, then only the transaction takes place. The fraudsters are very well aware of this and that is why they try to convince the users to share their OTP over phone. Once they manage to fool the users in to sharing their OTPs, they easily authenticate transactions and steal money from the account of those users. The golden rule here is that “Never share your OTP or PIN with anyone”. Many are unaware of this fact, hence fall into the trap.
Phishing scam is another way of duping the users. In this fraudsters would send you unauthorized payment links that looks to be original URL. When a user clicks on that link, then they will be directed to UPI payment app and may ask the user to select the app for auto debit. When a user allows for auto debit the amount is debited automatically from their UPI app.
There are cases where a person is tricked into downloading an app that access vital information stored on devices. Therefore one should always download trusted apps only.
In a recent incident of payment fraud, a person was duped into revealing his sensitive private credentials and thereafter he noticed unauthorized transactions one after the other. The person took the matter to the authority and was shocked to know that he was defrauded.
In another incident, a Joint Commissioner of Police was defrauded of 28000 rupees by a fraudster. Someone had duped him using his credit card credentials. The victim provided his personal details to the fraudster in response to an offer provided by him. A link was sent and the following day an amount of 10k rupees was debited from his account and further some more amount was deducted. The victim immediately informed the bank and the relevant authority for immediate action.
By following the below mentioned steps one can avoid falling into the trap of fraudsters and scammers:
One should never ever share their sensitive private information such as OTP, PIN, debit card details etc. No bank asks for your personal OTP or PIN, therefore make it appoint to never disclose these details.
It is advised to buy products from trusted online merchants only and such marketplaces. This ensures that your money is safe and secure.
Make sure that you keep yourself well aware of the latest types of methods employed by fraudsters to trick people. Lack of awareness causes people to believe anything and everything. Therefore, be well informed.
When fraudsters and scammers employ creative ways to con customers, then deployment of these innovations can help in thwarting every such attempt.
Monitoring of transactions can play a critical role in preventing payment frauds. With the help of cutting edge technologies such as AI and ML, it allows to identify fraudulent and suspicious pattern in transactions. These technologies have assisted Fintech firms to take preventive actions in real time and this includes informing the party or to block transaction.
It is a technological measure that shields a card number. It’s replaced by an exclusive series of numbers known as token. The substituted token doesn’t have any value outside the merchant channel thereby making the transaction secure.
It is another cutting edge technology that can bring down the number of payment fraud by augmentation of real time transaction data sharing and also by establishing an agreement of all parties.
Read our article:How can payment frauds be reduced during Covid-19?