47% of urban Indians faced financial frauds in last 3 years: Survey

In the case of UPI frauds, 4 in 10 of those who experienced it said that the link/ QR code sent to them to accept a payment instead led to money being debited from their account, the survey said. The study shows that the RBI, UPI and banks issuing credit cards need to put in place more safeguards to help prevent such financial frauds, it said. The survey received over 23,000 responses from household consumers located in 302 districts of India. 62 per cent respondents were men while 38 per cent respondents were women, it said.

“Consumer awareness needs to be created on priority for both UPI and credit card users. In addition, safeguards must be built so no Indian credit cards can be charged without an OTP authentication,” it said. For UPI, increased consumer awareness is critical. In addition to these steps, there is also a strong need to sensitise local police stations so staff their can guide citizens to file an online complaint within minutes as opposed to the current scenario where majority of the staff even in urban India is not capable of guiding a victim of online financial fraud, the survey said.

On different types of financial fraud transactions that family members surveyed have experienced in the last 3 years, some among the 7,409 who responded to the question indicated more than one option with 43 per cent indicating “fraudulent transaction on credit card”. Also 36 per cent indicated “fraudulent UPI transactions”, 13 per cent admitted “fraudulent transactions on debit cards”, 19 per cent said “fraudulent transactions on bank accounts”, 6 per cent indicated “fraudulent transactions on ATM cards”, 30 per cent mentioned “other types of fraud financial transactions” and 9 per cent of respondents did not give a clear reply, LocalCircles survey said.

LocalCircles said the credit card data of Indian consumers is easily available for sale by thousands of data vendors across India. With personally identifiable information like PAN card, Aadhaar, mobile number, email and address easily available in databases for sale and credit cards details available with mobile number, email or address being common, anyone with knowledge of spreadsheets can join these databases to profile individuals. “Such datasets being available in public domain make credit card holders extremely vulnerable to frauds as many international websites/apps do not require OTP authentication before charging an Indian credit card once the user has their credit card set to permit international transactions,” it said.

Of urban Indian household consumers who experienced credit card fraud in the last 3 years, nearly one in two experienced unauthorised charges by domestic and/ or international merchants/ websites, it said. On credit card frauds, it said 53 per cent mentioned “unauthorized charges levied by unknown international merchants/ websites”, 53 per cent saying “unauthorized charges levied by domestic merchants/ websites with whom we transact”, 41 per cent indicating “unauthorized charges levied by unknown domestic merchants/ websites” and 34 per cent mentioning “fraudulent transactions other than the ones listed above”, the survey said.

Of urban Indian household consumers who experienced UPI fraud in the last 3 years, 4 in 10 experienced that the link/QR code sent to them to accept a payment led to a debit being made from their account. Apart from card (credit and debit) fraud, high among the other financial frauds are linked to online payments, particularly through UPI, LocalCircles said.