DIGITAL PAYMENTS
INTELLIGENCE PLATFORM - ECONOMY
News: RBI to establish Digital
Payments Intelligence Platform amid a surge in bank and digital frauds
What's in the news?
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With the rise in digital payment scams, there is a
growing need for a collective approach to prevent and manage these issues.
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Considering the rise in digital payments, the
Reserve Bank of India (RBI) plans to create a Digital Payments Intelligence
Platform.
Proposal:
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The RBI has proposed to set up a Digital Payments
Intelligence Platform which will harness
advanced technologies to mitigate payment fraud risks.
Constitution of AP Hota
Committee:
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To take the initiative of setting up Digital
Payments Intelligence Platform, the RBI has constituted a committee, under the
Chairmanship of AP Hota (former MD & CEO NPCI).
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The committee will examine various aspects of
setting up a digital public infrastructure for the platform and is expected to
give its recommendations within two months.
Need for Setting up
Digital Payments Intelligence Platform:
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According to RBI data, domestic payment frauds jumped by 70.64% to Rs 2,604 crore during
the six-month period ended March 2024 from Rs 1,526 crore in the same period of
last year.
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The volume
of frauds also rose to 15.51 lakh during the March 2024 period from 11.5
lakh in the previous six-month period.
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The alarming increase coincides with India’s rapid transformation into a digital
payments powerhouse, fuelled by the widespread adoption of the unified
payments interface (UPI) since its launch in 2016.
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UPI transactions have seen explosive growth, surging 137% in the
past two years to touch ₹200-lakh crore.
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Hence, the regulatory measures like setting up of
digital payments intelligence platform will harness advanced technologies to
mitigate fraud risks.
Digital Payments
Intelligence Platform:
Aim:
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Gather intelligence across the digital payments
network.
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Enable real-time data sharing.
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Enhance the security of digital payments.
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Boost consumer confidence.
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Mitigate fraud risks.
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Provide accessible and secure financial solutions,
particularly empowering India’s youth.
Objective:
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RBI wants to expand the existing e-mandate system
as more people are using automated recurring payment.
Features:
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This system will now include payments that happen regularly but not at a fixed time,
such as topping up Fastag balances for
tolls or the National Common Mobility Card (NCMC) used in public transport.
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This change would allow customers to set their
Fastag and NCMC to automatically refill whenever the balance drops below a
certain level they choose.
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This will make it easier and quicker to pay for
travel and transportation.
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The RBI also aims to boost the use of UPI Lite, a service for fast, small payments
directly from a device.
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They plan to integrate
UPI Lite into the e-mandate system to encourage more people to use this
convenient payment method.