More than half of digital payment frauds in India are tied to UPI

UPI-related digital payment scams in India make up the majority of total digital payment frauds in India. More than half (55%) of all recorded digital payment scams in India were connected to the United Payments Interface. A further 18% are card-related, 12% are internet banking-related, and 9% come from phishing calls, according to a recent survey released on Tuesday

However, the majority of UPI-related frauds involve small ticket sizes. digital solutions platform Bureau and consultancy firm Praxis released a research titled "The Anatomy of Fraud 2023" that states that 50% of these have an average ticket size of less than ₹10,000. Another 48% of tickets range from ₹10,000 to ₹1,00,000 in size. Only 2% of these frauds involved a ticket worth more than ₹1,00,000.

Given that UPI has recently experienced remarkable growth in acceptance and popularity, the report's conclusions are extremely important. According to figures, 36% of all non-cash retail transactions in India occurred over UPI in 2019–20 (FY20). It increased to 44% in FY21. 57% of all non-cash retail transactions in FY22 were completed using UPI.

In most industries, identity-related frauds made up the largest portion of all frauds. In 2021, account-related fraud made for 65% of all frauds in the financial services industry. These consist of account creation and account takeover. Account-related fraud accounted for 54% of all frauds in the e-commerce sector.

According to the survey, the Centre is taking proactive steps to stop these frauds. Customers are being protected by initiatives like strict know-your-customer (KYC) standards and laws for real-money gambling industries, among others.

In addition, 60% of the firms responding to the poll said they would boost their spending on fraud prevention and detection during the following two years, as reported by Business Standard.