Why RBI proposes 1-hour delay for digital payments above Rs 10,000

It said that fraudsters are using a range of tactics, including bogus call centres, deepfake-driven impersonation scam, and mule account networks. “Almost all sections of society especially the vulnerable groups such as senior citizens have fallen prey to such APP (Authorised Push Payments) frauds.

Therefore, there is an urgent need to put in place systems and processes to address these issues. This discussion paper seeks stakeholder views on the need for introducing extra layers of safeguards,” the central bank said.

Why RBI wants a cooling period for high-value transfers

According to the RBI, introducing a delay at the payer’s end is crucial, as this is the point where the decision to transfer funds is made and where social-engineering tactics are deployed. “A short delay before execution of the debit can act as a preventive control by disrupting the fraudster’s psychological influence over the victim and by giving the payer an opportunity to reconsider the transaction,” it said.

It added that to keep low-value transactions seamless, such delay mechanisms are proposed to apply only to APP transactions above a specified threshold, which may be set at Rs 10,000 per transaction.

“As per information available with the National Cyber Crime Reporting Portal (NCRP), transactions above ₹10,000 account for approximately 45 per cent of reported fraud cases by volume, but about 98.5 per cent by value. Under this approach, once a customer (individuals including sole proprietors plus partnership firms) initiates an APP transaction exceeding ₹10,000, a lag period of one hour could be applied.

The lag can be applied at the payer’s end or at the payee’s end or both. From an ease of implementation perspective, it is suggested that the lag is introduced at payer’s end only,” the RBI said.

It added that during this period, the payer’s bank would provisionally debit the customer’s account, while allowing the payer the option to cancel the transaction for any reason. As per RBI, the proposed one-hour window is consistent with the “golden hour” principle in fraud-risk management, under which the initial period following a fraudulent transaction is critical to prevent the dissipation of funds.

“During this period, if the payer’s bank identifies the transaction as unusual or atypical, it may seek reconfirmation from the payer, while sharing appropriate information on the nature of the suspicion and cautioning the payer. If the payer, after reviewing the information provided, still chooses to proceed, the transaction will be executed by payer bank.

Further, recognising that certain transactions may be time-sensitive, an option may be provided to the payer to override the lag for a specific transaction by explicitly authorising it, for instance through a whitelisting mechanism. In such cases, the lag may be bypassed. Instead of allowing whitelisting of transactions or in addition to it, payees can be whitelisted by the payer. All payments to such whitelisted payees will not be subjected to time lag,” it said.