One of the key challenges to reducing frauds in India’s digital payments ecosystem is that security is seen as a cost overhead and not essential investment by stakeholders, said a report on Wednesday.
Other key challenges include fraud detection, investigation and legislative challenges, multi-level awareness, cross-industry collaboration, privacy laws, and organised criminal involvement, said the joint report by Data Security Council of India (DSCI) and PayPal India on Wednesday.
The report, titled ‘Fraud & Risk Management in Digital Payments’ covers various types of fraud scenarios such as buyer side, merchant side and cyber security frauds, and recent fraud case studies with their modus operandi.
Future fraud possibilities can shape up from exploitation of supply chain vulnerabilities, exploiting risk transfer controls and spoofing current fraud prevention mechanisms, said the study.
“Digitisation and cyber security is at the core of Digital India’s mission and online payment safety is paramount for India to emerge as a leader globally,” said National Cyber Security Coordinator Rajesh Pant on the occasion of the report’s release.
“The government has taken many steps to support businesses, SMBs across their digital journey, however upcoming legislations and strategies will further aid the positive momentum. Covid has also provided an opportunity to fast-track both adoption and regulatory focus.”
Digital payments have been growing in India at a much faster pace than global markets and thus safeguarding payments for consumers, micro, small and medium-sized enterprises (MSMEs), businesses is of utmost priority.
The e-commerce market in India is expected to grow to $200 billion by 2026 from $50 billion in 2018, the report pointed out.
UPI transactions in India have crossed 1.49 billion in volume and $41 billion in transaction value, in July 2020. The internet user base is expected to grow to 835 million by 2023 from 560 million in 2018.
As of March 31, 2019, 925 million debit and 47 million credit cards have been issued in India, second only to China.
The study showcased how upcoming technologies like Artificial Intelligence and Machine Learning can help prevent fraud.
“Digital payment safety is one of our key focus areas to alleviate the emerging concerns and underlying causes leading to mushrooming payment frauds,” said Rama Vedashree, CEO, DSCI.
“In order to find the right balance between enablement and protection, it is critical that a collaborative effort be undertaken by all stakeholders involved, to establish a comprehensive fraud management framework for digital payments in India.”
-IANS
