RBI plans a digital intelligence platform to detect fraud

The Reserve Bank of India plans to set up a centralised digital payments intelligence platform for sharing data on a real-time basis across digital payment ecosystem aimed at detecting fraud.

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Shaktikanta Das, Governor, RBI, said growing instances of digital payment frauds highlight the need for a system-wide approach to prevent and mitigate digital frauds.

It is, therefore, proposed to establish a digital payments intelligence platform which can share date on data real-time across the digital payments’ ecosystem, he said.

Panel formed

RBI has constituted a committee to examine various aspects of setting up the platform, he said.

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Digital payment fraud has witnessed a sharp jump of over five-fold to a record ₹1,457 crore in the fiscal year ended March 2024, according to the RBI annual report.

The alarming increase coincides with explosive growth of 137 per cent in UPI transactions in the past two years to touch ₹200-lakh crore, as per RBI data. Digital payments, including card and internet transactions, accounted for 10 per cent of the total fraud amount in FY24, an increase from 1.1 per cent in the previous fiscal year.

Anand Kumar Bajaj, Founder, MD & CEO, PayNearby, said the digital payments intelligence platform initiative by the RBI will enhance the security and transparency of financial system, reducing fraud risks and building trust among users.

Prashanth Ramdas, Partner, Khaitan & Co said while the RBI and NPCI have been implementing security measures on each customer facing payment system, this move would leverage technology and real-time data sharing architecture to detect and mitigate frauds.

This would also be significant in bolstering customer confidence and boosting financial inclusion, he added.

Amit Sachdev, COO, M1xchange, said the proposed platform will enable access to vital additional information on frauds and enhance the efficacy of Digital Credit Analytics enabled on TReDS.

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Ankit Ratan, Co-founder & CEO, Signzy, said the platform will leverage advanced technologies such as AI and machine learning to identify and mitigate fraud risks, ultimately leading to a safer digital payments’ environment.

The comprehensive measures will empower the industry to deliver a more secure and trusted digital ecosystem for all, he added.