Preventing Payment Frauds: RBI Forms Panel Led By Former NPCI CEO To Build A Digital Platform

The Reserve Bank of India (RBI) has reportedly set up a committee, comprising industry experts, to develop a digital public infrastructure platform aimed at combating payment frauds.

The committee will also recommend strategies for the platform to detect fraud within the digital payments ecosystem and propose measures for fraud prevention, ET reported.

The panel will be led by Abhaya Hota, the first CEO of the National Payments Corporation of India (NPCI).

The platform will establish the operational parameters and processes that will dictate the extent of data provision by reporting entities, such as banks and fintech companies. It will be the committee’s responsibility to define these parameters, the report said.

The panel will also define the procedures for identifying fraudulent transactions, which will then be reported to the Central Payments Fraud Information Repository (CPFIR). Additionally, it will assess the cost requirements and propose strategies to ensure the platform’s financial sustainability.

To protect customer data, the committee will recommend stringent safety measures throughout the process.

The committee’s members will include representatives from the NPCI, State Bank of India, HDFC Bank, and ICICI Bank. Key industry figures appointed to the panel include Vipin Surelia, head of risk at Visa; Arif Khan, chief innovation officer at Razorpay; Jitendra Gupta, founder of Jupiter; and Pranay Jhaveri, managing director of Euronet.

The development comes at a time when the number of online frauds in the country surged 334% year-on-year (YoY) to 29,082 in the financial year 2023-24 (FY24). The amount involved in these cases surged to INR 1,457 Cr in FY24 from INR 227 Cr in the previous year.

The RBI as well as the Centre have been actively taking measures to combat the rise in online frauds. Last month, the government held discussions with fintech startups and law enforcement agencies to collaborate on addressing challenges related to digital financial fraud.

In April, it was reported that the Ministry of Home Affairs was collaborating with SBI and several telecom companies to develop a solution aimed at alerting users about stolen one-time passwords (OTPs) to combat phishing attacks.