1-hr delay for digital payments over Rs 10,000: RBI proposes plan to curb frauds

The Reserve Bank of India (RBI) has proposed a one-hour delay for payments exceeding Rs 10,000 made through account-to-account transfers. This step is part of efforts to curb the increasing cases of digital payment fraud involving customer manipulation.

The delay targets authorised push payment (APP) frauds, where customers are deceived into transferring funds themselves under false pretences. The cooling-off period allows customers to cancel transactions and enables banks to identify suspicious activity before funds are withdrawn.

The RBI has also suggested an additional authentication layer for transactions above Rs 50,000. This measure aims to protect vulnerable groups, including senior citizens and persons with disabilities, by requiring verification from a trusted person for such high-value transfers.

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To tackle misuse of mule accounts, the RBI's discussion paper proposes limiting annual credits to Rs 25 lakh for certain bank accounts unless enhanced due diligence is undertaken. Transactions beyond this threshold would undergo further scrutiny before release.

The regulator recommends extending customer-controlled features across digital payment channels. These include transaction limits, on/off controls, and a "kill switch" that allows users to instantly disable digital transactions if fraud is suspected.

The RBI noted that most frauds now stem from social engineering techniques such as impersonation, coercion and deepfake-enabled scams, rather than system breaches. This shift underlines changing risks in the digital payments landscape.