Five UPI Frauds And How To Avoid Falling For Them
UPI frauds are on the rise and can be of several types. Being aware of such frauds and exercising caution can ensure that you do not fall into the trap
Today, Unified Payment Interface (UPI) has become an integral part of our lives. From paying at supermarkets to paying the local vegetable vendor, we tend to use UPI payments because it is fast and convenient. According to the National Payments Corporation of India, there were 13.3 billion UPI transactions conducted in April 2024.
However, with the rise of UPI transactions, UPI frauds have also seen a rapid growth. According to data by the Ministry of Finance, Government of India, there were 95,000 cases of UPI fraud in 2022-23. The Government is taking several measures to reduce the incidence of UPI frauds. For example, the RBI has proposed a four-hour time limit when user initiates a transaction of over Rs 2,000 with a new recipient. Here are some common UPI frauds and how to avoid being duped.
Phishing: Phishing remains one of the most common UPI frauds. Users typically receive payment links that look very similar to the merchant links. When they click on the link, they're taken to their payment app and prompted to enter the pin. "Once the pin is entered, the account is auto-debited to a fraudulent website. At times, it is not just a phishing link, but entire operations such as customer services are mirrored, and users are asked to make payments to fraudulent accounts before the product or service is dispatched," says Adhil Shetty, CEO, BankBazaar, a financial marketplace.
Misleading UPI Handles: Fake UPI handles such as BHIM Payment-UPI Guide, Bhim Banking Guide, Bhim Modi App, etc. can dupe users into revealing sensitive information. People fall victim because these resemble the original UPI handles. Once the fraudsters have the information they can use it to swindle you.
QR Code Tampering: When paying through UPI, in most cases we scan a QR code. "QR code tampering is an additional sophisticated technique that employs codes to redirect payments to illegal accounts," says Rohit Garg, Co-Founder and CEO, Olyv, a personal loan and financial solutions platform.
Collect Request Frauds: Scammers also use the collect request to scam people. They may claim it as a debt reversal or refund or give some other excuse to users to authorise a collect request by entering their PIN.
"The typical operation is to send some money to your account and then send multiple collect requests to reverse the transaction saying that the money has not been transferred or that it is the same request and not a different one, causing your account to be debited each time you enter your pin," says Shetty.
Vishing: "This refers to using impersonated calls/fake calls pressuring customers to part with info or enticing him/her with lottery/prize/refunds," says Venkatesh Rangan, Vice President - Compliance, India, Worldline, a payment and transactional services company.
So, for example, you may get a professional call from a number that seems legitimate, saying that you are eligible for some quick tax refund and then you are asked to share some sensitive information like UPI ID and OTP information. Once you share such information, the scamster will get access to your bank account and steal money.
How To Prevent Such Frauds
"Before making any transactions, confirm the recipient's UPI ID, conduct thorough research, especially for payments mentioned on social media or other public online sources, and avoid making payments without proper confirmation of the recipient's details," says Garg. He also adds that requests to scan QR codes to get money may be a sign of fraud.
To keep your phone safe, avoid installing unnecessary apps on your phone and only download from legitimate app stores. To prevent fraud, only use secure networks and don't respond to messages asking for money.
When You Are A Victim
"Report to UPI service provider and also the National cybercrime reporting portal on an immediate basis. Also, the customer can report to NPCI complaints portal and the Banking Ombudsman," says Rangan.
Customers can usually complain by calling helpline numbers, sending an email, going online, or using mobile apps. Also, the government usually has ways to deal with complaints about UPI fraud. "Customers should give detailed information about the scam and cooperate fully with the investigation to solve the problem quickly and prevent more losses," says Garg. In this way, victims of UPI fraud can seek timely resolution and help prevent similar scams in the future
