UPI Payment Fraud: Here are Safety Measures to Protect Your Money

Posted on: Jul 25, 2022 | 3 mins | Written by: HDFC ERGO Team

UPI Payment Fraud: Here are Safety Measures to Protect Your Money

Thanks to online payments, we can now efficiently complete a purchase anytime, anyplace, and with only a few clicks. One of the most common payment systems is the Unified Payment Interface (UPI), which is known for its efficiency and convenience of use for cashless transactions and online payments. But as a platform becomes more popular, fraud and scams also increase. This is also true of the UPI environment.

Several frauds involving UPI users have gained attention in recent years. Therefore, taking basic safety precautions while conducting a digital transaction is essential, regardless of whether you regularly use online banking or have reservations about it. Nowadays, people have started considering cybersecurity insurance as an option, as in this case, the insurance contract transfers part of the risk to the insurer in return for a monthly or quarterly payment.

Using the bank account information and the mobile phone associated with the bank account, the UPI ID can be created. The user's cell phone number will get an OTP (one-time password) from the application, which may be used to finish the registration process and set a PIN. After that, transactions may be completed using either the mobile number or UPI ID. Users only need to use the cell phone number registered with the bank or the UPI ID to transfer money. But, as we are getting close to becoming more digital, the number of fraud cases associated with UPI is changing.

List of Common UPI frauds:

First, we all need to address all the common frauds related to UPI, as they are supposedly common, but we tend to miss them.

1. Phishing Scams:

The first and one of the most missed and ignored scams is named phishing scams. At this point, scammers send an email or SMS with illegal links. Your account will be automatically debited when you click on these links, which will take you to the UPI app on your phone. These URLs have the potential to do great harm, as well as give your phone a virus or malware infection.

2. Remote Screen Monitoring:

Downloading an untrusted program from the app store may occasionally result in a privacy violation and data leak. These third-party applications can access UPI app information and take private information from your phone, which can lead to UPI fraud.

3. Fake Calls:

The fraudsters will get bulk data and will call you pretending to be a bank employee and request your UPI pin or that you download a third-party app, claiming it is necessary for verification. They will have access to your data and account information if you do this.

4. Unverified Links:

Many people are not aware that using the UPI app to receive money does not require you to scan a QR code or input your UPI pin. Hackers frequently provide phone URLs with the opportunity to "request money." A code or your UPI pin will be requested when you click on this link. This can expose any of your financial information to hackers.

Online scams are more prevalent as the distinction between the actual world and the virtual one gets narrower every day. As we spend more time online, scammers are also developing fresh strategies to defraud us of our hard-earned money. To be safe, keep these few things under control.

Safety Measures to be Safe from Cyber Attacks:

1. Maintain proper privacy:

Never provide your UPI or PIN to anybody on the other end of a customer service call or message who says they are from a reputable firm, bank, or government agency. Your UPI PIN will never be requested by them. These calls play into your concern that you could lose access to your account or miss a crucial app update. Always examine the information provided by SMS senders or callers; if someone asks for your PIN information, it is evident that they are a fraudster.

2. Always follow secure browsing:

When looking for customer service phone numbers, try using the official website rather than Google. Scammers sometimes post phone numbers on websites that appear authentic or authorized but are fraudulent. These numbers might direct you to phone call centres operated by hackers.

3. Verify contacts:

Never reply to unconfirmed calls or messages from someone posing as bank officials. Additionally, SMS messages can be issued in the names of the Insurance Regulatory and Development Authority of India or the Employee Provident Fund Organization (EPFO) (IRDAI). Note that they do not, however, message people.

4. Spam warning:

Never disregard the spam alert that the digital payments app sends to your phone. While you are transacting with a user, a warning will appear if the person has already been reported. When a user receives a request from an unidentified account, UPI applications like Google Pay, PhonePe, etc. notify them.

5. Keep changing your UPI pin:

If you don't update your UPI pin every month, changing it every three months is best to keep your account secure.

6. Pick for cybersecurity insurance:

In general, cyber insurance protects your company against responsibility in the event of a data breach involving sensitive client data, including Social Security, credit card, account numbers, and health records.

Who Needs Cyber Insurance?

The size of the company and its yearly income are only two of the variables that will affect how much cyber insurance coverage will cost. Other elements may include the sector of commercial activity, the kind of data usually handled by the company, and network security in general.

An organization with weak cybersecurity, a history of being the target of hackers, or a data breach would probably be charged more for cyber insurance coverage than one with a strong track record of keeping itself safe.

Due to the sensitive nature of the industries they operate in, sectors like health and finance are likely to find that cyber insurance coverage costs more.

Types of Cybersecurity Insurance

Cybersecurity Insurance is classified under two basic types:

1. Cyber Liability Insurance: It addresses cyber hazards related to IT companies. It is responsible when an IT company keeps a client's financial and personal information on the servers.

2. Individual Cybersecurity Insurance: It is designed for regular web surfers. The danger of identity theft, social media liability, malware assaults, cyberstalking, and malware attacks is covered by insurance.

What is the Future of Cyber Insurance?

How cyber insurance works will change as hacks become more frequent and cybercriminals become more daring with their campaigns. As already said, cyber insurance providers are very unlikely to provide policies to companies that don't take cybersecurity seriously.

Conclusion

An insurance claim payout is an expensive and entirely reactive action for the insurance company. Because of this, some companies are beginning to adopt a more proactive approach to cybersecurity, actively encouraging clients to do so rather than just being there to pay out if something goes wrong.

So, while concluding, we all should keep a tight check on all the scams which are happening daily. Fraudsters are getting their grip tight daily and becoming freer to conduct all these crimes, the line we all must keep a close watch on as the world is moving towards a more digitalized world. We should also consider Cyber security Insurance, as it will help you in your time of need. However, in case you encounter a fraudster, either go into your UPI app and visit the "Help" area or report the event to the nearest cyber crime centre. It will include information on how to report a cybercrime as well as safety tips for using UPI to conduct transactions. Keep these suggestions in mind when you next make an EMI loan or make any payments online via any digital platform. Enjoy the ease of online purchases while protecting yourself from fraud.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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