To mitigate financial fraud, the Reserve Bank of India (RBI) on Thursday proposed lagged credit for authorised push payments and a control or kill switch for digital payments.
It further proposed limiting aggregate credits in an account to help counter the problem created by mule accounts, and the designation of a trusted person to authenticate high-value transactions for citizens aged 70 years and above and persons with disabilities.
The central bank proposed these norms in a discussion paper released on Thursday amid a rise in fraudulent activities targeting customers. It announced the discussion paper as part of its statement on developmental and regulatory policies during the February monetary policy meeting.
The central bank has asked for feedback and comments on the discussion paper by May 8.
National Cyber Crime Reporting Portal (NCRP) indicate that fraud related to digital payments is on the rise, with 28 lakh frauds reported in 2025, amounting to Rs 22,931 crore, higher than 24 lakh, totalling Rs 22,848 crore in 2024, 13.1 lakh worth Rs 7,465 crore in 2023, according to the discussion paper.
In the lagged credit for authorised push payments, the central bank proposed a short delay at the payer’s end for transactions above Rs 10,000.
Under this approach, once a customer initiates a transaction exceeding Rs 10,000, a lag period of one hour could be applied. The lag can be applied at the payer’s end, or at the payee’s end, or both. During this period, the payer’s bank would provisionally debit the customer’s account, and the payer would retain the option to cancel the transaction for any reason.
The high-value transactions were proposed to fall under this ambit because transactions above Rs 10,000 account for approximately 45 per cent of reported fraud cases by volume, but about 98.5 per cent by value.
The central bank also proposed additional authentication by a trusted person for high-value digital transactions by vulnerable sections, such as citizens aged 70 years and above and persons with disabilities, and accounts to receive credits commensurate with the nature of the relationship with banks.
Further, it said customers can be provided with a digital payment controls, which would consist of a ‘switch on/off’ facility for any digital payment mode, as well as for setting limits for different transaction types at the account level, and with a single facility to disable all digital payment transactions from the account (‘kill switch‘) at one stroke.
Kill-switch activation at the account level will override other controls/ configurations set up by the account holder. Once the kill-switch is enabled, disabling the kill-switch to re-activate digital payments can be permitted either through digital modes after taking proper authentication/verification measures, or through a physical visit to a bank branch by the account holder, as proposed by the RBI in the discussion paper.
