The digital revolution is at its peak in India. With affordable data plans and a mobile-first economy, many users are online every day. While it is good for the economy and helps people express themselves freely, certain risks are associated.
In recent years, there has been a steady increase in the use of UPI payments. In the fiscal year 2023, there were 84 billion credit transactions using UPI, which is enormous. While it makes digital payments easy and accessible to common people, certain risks are associated. In recent years, we have also seen an increase in cyber fraud, especially using UPIs.
If you are a UPI user, this is a guide you can’t miss, as today we will explore how UPI frauds work and how you can safeguard yourself against them.
Understanding UPI Fraud: Examples
Many types of UPI fraud happen on a daily basis:
Example 1: Tricking Innocent People
To understand how UPI fraud works, we will use the most common example that scammers also use to target people who simply use UPI and don’t know much about it. They request money on your UPI ID or UPI app, saying they will deposit it. Once you approve the request, the money is debited from your UPI account and transferred into the scammer’s account.
Let’s see what it looks like:
- You will get a call from an unknown number.
- The caller will pretend to have some connection with you or any family member or friend of yours.
Note: They generally say they know your father or friend. They even ask how you have been establishing rapport.
- After establishing rapport, they generally say they must deposit money into your bank account since they cannot send it to your family member or friend.
- If you are negligent and don’t pay attention, you might give in and agree to the transfer.
- But instead of sending money to your account, they send a payment request.
- Sometimes, they even send a small amount of money to establish trust.
- As humans, we often ignore small attention in everyday tasks. So when a request message pops up, it is a message for deposit.
- If you are unaware of the UPI system, the scammer on the other side will ask you to approve the request by entering your UPI pin.
- When you enter the PIN, the transfer gets approved, and money gets debited from your account.
- Then, the scammer will block you.
This is how scammers usually trick innocent people who are not completely literate about using UPI. Since the users are unable to differentiate between a payment request and a money transfer, they end up approving the payment request.
Example 2: Fake Emergencies
Another recent UPI fraud is fake emergencies. In this scenario, the scammers call you and pretend to be an authoritative figure who has caught your friend or family member in criminal activity. They usually present extreme-case scenarios of emergencies in which the innocent user does not have time to think and ends up transferring money voluntarily to take care of the situation.
Here is an example of what it looks like:
- The scammers will call you to inform you that your son/daughter has been caught in a raid.
- Scammers will inform you that they are police officers, and if you do not want the chargesheet pressed against your son/daughter, you must transfer a substantial amount of money immediately.
- In many cases, the parents panic because they often don’t have the time to think or to contact their child to corroborate the story.
- In India, most people avoid police and court matters due to their negative connotations and try to settle them by bribing.
- So they end up paying the scammers whatever amount they demand.
This whole scam exploits parents’ emotions for their children. At the moment, they panic and do not have much time to think and reach out to their child. Since time is of the essence, they make the payment without a second thought. This is what creates the problem.
Similarly, many other cases of UPI fraud occur every day in India, which is why we need better awareness.
Read:- Important Internet Security Tips Every User Should Know
Common Tactics Used by Scammers
UPI is a super easy way to send money. It’s connected to your bank account, like an email address, but for money. To pay someone, type in their special UPI ID or scan a code with your phone. Once you confirm with your secret PIN, the money zips off in a flash!
But because UPI is so simple, some bad guys try to take advantage. Here’s how they might trick you:
Fake Bank Calls: Imagine getting a call from someone saying they’re from your bank. They might tell you about a weird transaction or say they need to upgrade your account. Then, they’ll try to get you to share your UPI PIN or a special code they send you. Remember, real banks will NEVER ask for this secret information!
Sneaky QR Codes: Scammers might show you fake deals or contests online and ask you to scan a QR code to “pay.” But that code could be linked to a fake account, stealing your money instead!
Phoney Apps & Websites: Be careful downloading apps or visiting websites that look like real UPI platforms. These fakes might try to steal your login details or trick you into sending money you didn’t mean to.
The “Oops! I Sent Too Much” Scam: This one tries to make you panic. You might get a small amount of money (like ₹200) from someone you don’t know, followed by a message asking you to return it because they made a mistake. Don’t be fooled! This is just a trick to get you to send money to a fake account.
SIM Swap Surprise: Bad guys might target your phone number in a more complex plan. They could try to convince your phone company (through talking and maybe even lying) to give them a new SIM card for your number. Then, they might be able to steal the special codes sent to your phone for UPI transactions.
Some Tips to Safeguard Yourself
Now that you’re a UPI pro and know all the scammer tricks let’s build a super strong shield for your UPI account! Here are some secret weapons to keep your money safe:
Your PIN is Top Secret: This is super important! Never tell ANYONE your UPI PIN, not even someone who says they’re from your bank or customer service. You need to remember that you never have to provide your UPI PIN to anyone for any money transfer or any other activity. Think of it like your ATM PIN – it’s yours and yours only!
Double-check everything!: Before you hit that “pay” button, double (or even triple) check the person’s UPI ID or QR code. One tiny mistake could send your money to the wrong place!
Stick to the Official Stores: Only download your UPI app from the official app stores, like Google Play or Apple’s App Store. Don’t download apps from weird websites; they might be fakes!
Public Wi-Fi is a No-Go: Public Wi-Fi is like a playground for hackers. Avoid using UPI on public Wi-Fi because someone might be able to steal your information.
Make Your PIN Super Strong: Choose a PIN that’s hard to guess. Don’t use your birthday or anything someone could easily figure out. If your phone lets you, you can even use your fingerprint or face instead of a PIN.
Be Careful of Surprise Payments: If someone you don’t know sends you money, be suspicious! Don’t send it back immediately, even if they say they made a mistake. It could be a trick to steal your money.
What Else?
Being safe is always better than having to fix problems later. Here are some ways to stay extra careful with your UPI:
- Pick One Bank Account: You don’t have to connect all your bank accounts to UPI. Choose the one you use most for everyday things like buying snacks or movies. This way, even if something goes wrong, the damage is limited.
- App Updates Are Important: Like video games get updates, your UPI app needs them, too! These updates fix any weaknesses someone might try to exploit. So, keep your app updated whenever a new version is available.
- Get Alerts for Transactions: Turn on alerts for your UPI account. This way, you’ll get a message whenever money comes in or goes out. It’s like having a personal assistant tell you about your money!
- Report Trouble Quickly: If you think someone might be trying to steal your money through UPI, tell your bank right away. Most banks have people available 24/7 to help with this kind of thing. You can also report it to NPCI, which manages UPI in India.
- Stay Smart About Scams: The more you know, the harder it is for scammers to trick you. Watch for warnings from your bank, NPCI, and other trusted websites about the latest UPI scams.
Keep UPI Payments Safe
India’s digital payment revolution is here to stay, and UPI is an effective instrument for financial inclusion and convenience. You may confidently navigate this digital terrain by knowing prevalent frauds, implementing reasonable security procedures, and remaining watchful. Remember, a little prudence will go a long way toward protecting your hard-earned money.
Here are some additional resources to empower yourself further:
- NPCI website: https://www.npci.org.in/what-we-do/upi/dispute-redressal-mechanism
- RBI (Reserve Bank of India) advisories: https://www.rbi.org.in/commonman/English/scripts/rbicautions.aspx
By following these tips and staying informed, you can ensure that your UPI experience is smooth and secure and empowers you to participate fully in India’s exciting digital future.
