The Reserve Bank of India (RBI) would set up a compliance and tracking system portal to tackle the multiplication of cyber-fraud and seeks to establish a better redressal mechanism for consumers.
With digital transactions gaining traction, RBI’s customer-protection measures are seen as a bid to promote and improve confidence in the digital channel. This will support the government’s objective of creating a ‘less-cash’ economy.
“The Reserve Bank is actively engaged in improving customer service in banks by addressing existing inadequacies and the need to benchmark it against international standards in order to instil timeliness and quality by harnessing technological developments and appropriate incentives to facilitate change,” the RBI said in its Report on Trends and Progress.
RBI data showed the number of fraudulent cases rose to 5,917, amounting to Rs 41,160 crore in 2017-18, up from 4,306 worth Rs 10,170 crore in 2013-14. Of the reported frauds, 22.7% were cyber related in 2013-14 while the percentage grew to 34.1% in 2017-18, indicating a hike in not just the volume of fraudulent cases but also more cyber-related crimes.
Other than the registered banks and NBFCs, the proposed online portal would also address cybersecurity complaints from all regulated entities including Prepaid Payment Instruments (PPIs) and mobile banking interfaces as directed under the Internal Ombudsman Scheme of 2018, according to the central bank.
“RBI’s extant guidelines on limiting customer liability in respect of unauthorised electronic transactions involving banks and credit card issuing NBFCs would be extended to the users of PPIs issued by other entities currently not covered by the same,” the report said.
The Ombudsman guideline aims to reduce any losses for the customer in cases of fraudulent transfers by capping the customer liability at Rs 25,000 if the customer brings the discrepancy to the notice of the financial institution concerned within seven working days.