India’s Digital Payments Surge Amid Rising Cyber Threats
Generative AI, while contributing to more sophisticated phishing attempts, is also being used to enhance security measures
India’s digital transaction ecosystem is evolving at a rapid pace, with multiple payment options now available for consumers. From UPI transactions linked to bank accounts or RuPay cards, to using credit or debit cards for purchases, the future of payments is expanding to include modern methods like tap-to-pay via Android phones or smartwatches and scanning QR codes. The options are many, and they’re driving significant growth in India’s digital payment landscape.
In the first half of 2024 alone, UPI transactions reached 78.97 billion, marking a 52% increase compared to the previous year. Alongside this, 3.73 billion card transactions were recorded during the same period, demonstrating the growing shift towards digital payments across the country.
However, with increased transaction volumes comes a rise in cyber risks. Cybercriminals are eyeing this surge, and the higher the volume, the better their chances of success. Fraudulent financial transactions, which amounted to dollar 5.5 billion in 2023, are projected to grow to dollar 12.6 billion by 2028.
To counter this threat, financial institutions are turning to advanced behavioral solutions that use models and algorithms to identify bots, analyse user behavior, and flag risky transactions in real time. This approach is crucial in tackling threats such as Account Takeover (ATO) fraud and scams like pig-butchering, which are becoming increasingly common.
Generative AI, while contributing to more sophisticated phishing attempts, is also being used to enhance security measures. Mastercard, for example, has implemented AI-powered solutions like Decision Intelligence, which monitors over 112 billion transactions annually. “With AI-powered solutions such as Decision Intelligence, Mastercard monitors over 112 billion transactions annually, providing real-time authorization and fraud detection to customers,” says Joy Sekhri, Vice President of Cyber & Intelligence Solutions, South Asia at Mastercard.
In addition to strengthening security, Mastercard is also investing heavily in its tech infrastructure. This month, the company inaugurated a new state-of-the-art Tech Hub in Pune. The facility, which will house over 6,000 technologists and engineers, is set to play a key role in advancing Mastercard’s global tech operations. This makes Pune home to Mastercard’s largest workforce in a single city, underscoring the company’s commitment to innovation and security in the digital payments space.
As India’s digital payment ecosystem grows, so too does the need for robust cybersecurity measures to protect consumers and their money.
