In a bid to curb frauds in digital payments, the Reserve Bank of India (RBI) has proposed several safeguard measures, including lagged credit for authorised push payments.

The RBI’s discussion paper, titled ‘Exploring safeguards in digital payments to curb frauds, was released on Thursday.

Some of the steps proposed include a control or kill switch for digital payments; a limit on 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 discussion paper is open for public comments and feedback until 8 May.

“A typical fraud through digital payments may not involve technical compromise of systems, but mostly through manipulation of users through social engineering, coercion, or impersonation. Victims, acting under deception, themselves initiate and authenticate transactions, leading to ‘authorised’ push-payment (APP) frauds,” RBI said in the paper.

There is an urgent need to put in place systems and processes to address these issues.

“Fraudsters are deploying various tactics, such as bogus call centres, deepfake-driven impersonation scams and mule account networks. Almost all sections of society, especially vulnerable groups such as senior citizens have fallen prey to such APP frauds,” the RBI said.

The APP frauds are able to transfer funds instantaneously due to the seamless payment environments. “Post-transaction remedies to recover such funds being limited, a defrauded user is often left with a few remedies and uncertain outcomes, which are time-consuming and show low recovery rates,” the RBI said.

As per data from the National Cyber Crime Reporting Portal (NCRP), digital-payment frauds have been on the rise, with 28 lakh frauds cases being reported in 2025 involving Rs 22,931 crore. This is higher than the 24 lakh cases in 2024 totalling Rs 22,848 crore, and 13.1 lakh incidents worth Rs 7,465 crore in 2023.

In case of 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, 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.

Transactions above Rs 10,000 account for approximately 45% of reported fraud cases by volume but about 98.5% 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.