In response to the rising number of online frauds and cybercrimes across India, the Department of Telecommunications (DoT) has launched a technologically advanced tool, the 'Financial Fraud Risk Indicator' (FRI). This tool aims to protect millions of mobile users from financial fraud and enhance security during digital payments.
Why was such a tool necessary?
While smartphones and internet access have simplified our lives, they have also led to a surge in online scams and cyber fraud. Cases of banking fraud via mobile numbers, fraudulent KYC updates, scams via phone calls, and phishing through fake links are on the rise. Individuals unknowingly trust such numbers and lose their money. To combat this serious issue, the DoT launched the 'Financial Fraud Risk Indicator' (FRI). This tool uses technology to identify mobile numbers involved in fraudulent activities or exhibiting suspicious behavior, alerting users to prevent them from becoming victims.
What is the 'Financial Fraud Risk Indicator'?
The 'Financial Fraud Risk Indicator' is a smart tool developed by the DoT specifically to prevent online fraud. It tracks mobile number activities to determine if a number is involved in financial fraud or suspicious activities. If a number has received fraud complaints or has been used in fraudulent transactions, the tool flags it as high-risk, categorizing it as 'medium', 'high', or 'very high' risk based on its activity.
The tool's primary advantage is its proactive nature. When initiating an online payment to an unknown number, the FRI checks its trustworthiness. If a high fraud risk is detected, it alerts the user, preventing them from sending money. This safeguards both users and banks from financial losses.
How does it work?
According to the DoT, the tool gathers data from various sources:
- Telecom company reports
- Data from past cyber fraud cases
- Information on suspicious activities shared by financial institutions
- User complaints
By compiling data from these sources, the tool analyzes each mobile number's activity to determine its financial risk rating.
Where and how will users benefit?
The DoT plans to integrate the FRI with the Unified Payments Interface (UPI). When attempting to send money via UPI to an unknown number, the tool will verify the number. If the number is flagged for fraudulent activity or has received fraud complaints, a warning will appear: 'This mobile number is in a high-risk category; please exercise caution.' This will alert users before sending money to fraudulent accounts.
Banks, mobile wallet companies, payment gateways, and other digital payment platforms will also benefit from this tool. The government will make it available to these institutions for system integration. Once integrated, the tool will verify numbers at each payment processing step, reducing the likelihood of financial fraud and enhancing security for millions of users' digital transactions.
Direct benefits for millions of users
This tool allows individuals to assess the risk level of a number before transferring money. Benefits include:
- Protection from fraudulent calls and messages
- Assistance in preventing financial scams
- Curbing incidents like KYC fraud
- Increased transparency and security in online payments
- Empowerment and increased confidence in digital transactions for the general public
A significant step by the government to secure Digital India
The government has taken a significant step towards making Digital India secure and reliable. The DoT's 'Financial Fraud Risk Indicator' tool will verify mobile numbers during digital transactions, indicating whether the number is safe. If a number has been involved in a scam or fraud, the tool will alert the user, preventing financial loss and building trust in digital transactions.
The government aims to ensure people can make online payments without fear, while remaining fully protected from fraud. This tool will provide mobile numbers with a form of digital identity, making it easier to identify trustworthy individuals. Overall, it is a smart technological initiative to secure and strengthen the Digital India mission.
Use of technology and data analytics
The FRI is a smart technological system utilizing artificial intelligence (AI) and data analytics. It continuously analyzes the activities of millions of mobile numbers, determining which might be linked to fraudulent activity. Suspicious activity triggers immediate tracking and updates to the number's risk profile. This real-time process ensures timely fraud detection. The tool improves daily with new data to provide timely alerts against cyber fraud.
What should users do?
- Be cautious of calls or payment requests from unknown numbers
- Check the risk profile before transactions (once the feature is publicly available)
- Report suspicious numbers to the DoT portal
- Do not share banking information through unauthorized links or calls
The DoT's 'Financial Fraud Risk Indicator' is a significant step towards digital security. It will not only protect millions of mobile users from financial fraud but also enhance transparency and security within India's digital payment infrastructure. Once publicly available, this tool will be a decisive blow against cyber fraud.
