Mumbai: The Reserve Bank of India on Thursday released a discussion paper proposing a series of measures to tackle the sharp rise in digital payment fraud, including a mandatory time lag on certain bank transfers, extra authentication for senior citizens making large transactions, caps on suspicious accounts, and a one-click "kill switch" for customers to instantly freeze all digital payments. Comments on the paper are open until May 8, 2026.
The centrepiece proposal is a one-hour delay on account-to-account transfers above Rs 10,000 made by individuals, sole proprietors, or partnership firms — transactions where there is no chargeback mechanism if fraud occurs. The delay could be applied at the sender's end, the receiver's end, or both. The Rs 10,000 threshold is deliberate, as such transactions account for around 45% of fraud cases by volume and represent nearly 98.5% of total fraud value, according to data from the National Cyber Crime Reporting Portal (NCRP).
For senior citizens and persons with disabilities, the RBI has proposed an additional layer of verification for transfers above Rs 50,000, potentially requiring approval from a pre-designated trusted person. Nearly 92% of fraud losses by value occur above this threshold, often through social engineering and impersonation scams.
The RBI has also proposed giving customers greater control over their own accounts through channel-wise on and off switches, self-set transaction limits, and a kill switch to instantly disable all digital payments, accessible via mobile banking, internet banking, branches, or IVR systems.
To crack down on "mule" accounts which are bank accounts used by fraudsters to receive and launder stolen funds — the RBI has proposed capping annual credits at Rs 25 lakh for accounts that have not undergone enhanced due diligence. Accounts seeking higher limits would need to provide additional verification of their business profile and funding sources.
The proposals come against the backdrop of an explosion in both digital payments and fraud. While digital payment volumes have grown at a compound annual rate of 53% over the past decade, reported fraud cases have surged from 2.6 lakh in 2021 to 28 lakh in 2025 — with the value of fraud jumping from Rs 551 crore to nearly Rs 22,931 crore over the same period, driven by deepfakes, fake call centres, and mule account networks.
The centrepiece proposal is a one-hour delay on account-to-account transfers above Rs 10,000 made by individuals, sole proprietors, or partnership firms — transactions where there is no chargeback mechanism if fraud occurs. The delay could be applied at the sender's end, the receiver's end, or both. The Rs 10,000 threshold is deliberate, as such transactions account for around 45% of fraud cases by volume and represent nearly 98.5% of total fraud value, according to data from the National Cyber Crime Reporting Portal (NCRP).
For senior citizens and persons with disabilities, the RBI has proposed an additional layer of verification for transfers above Rs 50,000, potentially requiring approval from a pre-designated trusted person. Nearly 92% of fraud losses by value occur above this threshold, often through social engineering and impersonation scams.
The RBI has also proposed giving customers greater control over their own accounts through channel-wise on and off switches, self-set transaction limits, and a kill switch to instantly disable all digital payments, accessible via mobile banking, internet banking, branches, or IVR systems.
To crack down on "mule" accounts which are bank accounts used by fraudsters to receive and launder stolen funds — the RBI has proposed capping annual credits at Rs 25 lakh for accounts that have not undergone enhanced due diligence. Accounts seeking higher limits would need to provide additional verification of their business profile and funding sources.
The proposals come against the backdrop of an explosion in both digital payments and fraud. While digital payment volumes have grown at a compound annual rate of 53% over the past decade, reported fraud cases have surged from 2.6 lakh in 2021 to 28 lakh in 2025 — with the value of fraud jumping from Rs 551 crore to nearly Rs 22,931 crore over the same period, driven by deepfakes, fake call centres, and mule account networks.
