Credit Card Fraud Cases Plummet by 49% in India, Digital Payments Remain Top Target for Scammers
A Significant Reduction in Credit Card Fraud Cases in India
According to the Reserve Bank of India’s annual report for 2022-23, there was a staggering 49 per cent reduction in the amount involved in total fraud cases reported during FY2023 compared to the previous fiscal year. This is certainly good news, but experts warn that digital payment platforms remain the primary target for scammers.
Digital Payments: The Primary Target for Scammers
The report reveals that banks witnessed a massive surge in fraud cases in the digital payment category - card/internet - during the fiscal ended 2023-24, accounting for almost 49 per cent or 6,659 cases of total fraud reported. This is despite a significant reduction in the overall number of fraud cases from FY2022 to FY2023.
Loan Portfolios: A Hotspot for Fraudulent Activities
The report also highlights that loan portfolios continued to be a hotspot for fraudulent activities, with public sector banks contributing the maximum amount to these frauds. In contrast, private sector banks reported the highest number of fraud cases, although they were primarily small-value card/internet frauds.
Analysis of Bank Group-wise Fraud Cases
An analysis of bank group-wise fraud cases over the last three years shows that while private sector banks reported more fraud cases, public sector banks continued to contribute the maximum amount to these frauds. The report also highlights a significant time-lag between the date of occurrence of a fraud and its detection, with a whopping 93.7 per cent of frauds reported in FY2021-22 occurring in previous financial years.
Measures to Improve Data Reliability
To improve data reliability, the RBI has advised lenders to conduct thorough due diligence and ascertain involvement before reporting fraud or non-cooperative borrowers. The central bank has also emphasized the need for proper proof/evidence to support these claims.
Staying Vigilant Against Credit Card Fraud
With digital payments on the rise, experts warn that credit card fraud cases are unlikely to disappear anytime soon. As a result, it is crucial for individuals and businesses alike to remain vigilant and take steps to protect themselves against these types of scams:
- Conduct thorough research before making online transactions
- Keep your credit card information confidential
- Monitor your account statements regularly
- Report any suspicious activity to your bank or financial institution
- Use strong passwords and enable two-factor authentication whenever possible
By taking these precautions, individuals and businesses can reduce the risk of falling victim to credit card fraud.