How UPI frauds are happening in India

January 17, 2021

Financial frauds are increasing day by day all over the world, but the government is still promoting the digital mode of transactions and suppressing the use of cash for day-to-day activities. To put forth the motive government of India started a Unified Payment Interface (UPI), which is a real-time money transfer system between two bank accounts. The bank accounts involved in the transaction may be within the same bank or a different bank in India.

No doubt that UPI is a very simple and secure transaction system, and that's why popular too. But, still because of our unawareness and laziness fraudsters are capable of snatching money from our bank accounts.

Hackers use various creative tricks to gain access to your phone (it could be a simple keypad phone) or passwords or OTP numbers sent via bank.

How fraudsters access the phone?

Hacker's tricks to get access to the target phone varies from physical friendship to online friendship and phone calls.

A friend or an unknown person may ask your phone just to make an emergency call and can install a remote desktop app like AnyDesk. This way hacker gains full access to your phone remotely even without your permission.

Many people have received a call from a fraudster and he may pose himself as one of their old friends and may ask to install the app.

Mostly scammers posing themselves as bank representatives, asking questions related to the account. These individuals weave a web of lies to grab the victim's personal details as well as secret details. These details are used to gain access to UPI or phone.

Hackers send an SMS and ask the victim to forward it to another number that they provide. After the message is successfully sent, it permits the fraudster to link the victim’s mobile number or account through UPI to their mobile.

SIM cloning is also gaining popularity among hackers, they just make a copy of your SIM and can send/receive calls and SMS as one can do with his phone. This method provides easy access to the UPI account of the victim.

How to avoid UPI fraud

UPI frauds can be avoided by being alert and keeping yourself well informed. Keep your credentials safe and do not share them with anyone over the phone or email. Anyway if you need to share any confidential information over email just buy a digital certificate and install it on your email client, which encrypts and secures your communication.

1. Don't engage with fraudsters

Do not talk to unknown or suspicious persons over the phone and do not share confidential details with anyone. Keep your phone in custody and password protected. The communication must be disconnected as soon as you come to know that person talking on the phone asking for any PIN/ Password or OTP etc.

2. Be extra vigilant when you approve "Money Requests"

The most common method of UPI scam is sending "Money Requests" and sometimes people approve these money request unknowingly or in hurry. It is strongly advised that one should double-check the ID of the request sender before approval.

3. Don't follow suspicious links in SMS / Email

Hackers send the app links in SMS or Email, clicking on them the app starts downloading and installs itself. Thus hackers on the other end gain full access to your phone which leads to financial fraud.

4. Keep track of bank account balance

Most of the victims even do not aware that they have lost their money. They may get some clue of theft months later and then it becomes too late to take any action against fraud. Keeping an eye on the UPI app like BHIM and bank account balance helps immediate detection of fraud.

5. Double check UPI ID before sending money

Though UPI transactions are reversed, it is a long and again time-consuming process therefore it is advised to double-check the UPI ID before sending money to any seller or service provider.

UPI frauds complaints

Being real-time money transfer and secure mechanism, UPI fraud complaints can be raised to the bank, by visiting the bank and writing an application to a bank manager. In the application, one must mention all the transaction details and also describe the reason why the transaction is disputed and why you like the transaction to be reversed.

If you have received an email or SMS from the bank, also attach a copy of the same with your application.

The complaints resolution system at the banks is very complex and time-consuming. The victim needs to prove all the claims regarding fraud and that is not easy to do for every victim.