In a bid to curb rising digital payment frauds, the Reserve Bank of India has put out a discussion paper proposing a host of new safeguards, including delays in some money transfers, adding checks for vulnerable users, restrictions on suspicious accounts, and an emergency mechanism for customers to block transactions immediately.
The central bank has sought comments on the proposals until May 8, 2026. One of the key recommendations is to introduce a cooling-off period of one hour for account-to-account transfers above Rs 10,000 made by individuals, sole proprietors and partnership firms. These transactions currently do not offer any chargeback option in case of fraud. The proposed delay may be implemented at the sender’s end, the receiver’s end, or both.
The threshold has been set at Rs 10,000, as such transfers constitute about 45% of fraud cases by volume and account for nearly 98.5% of the total value involved, according to figures from the National Cyber Crime Reporting Portal. The paper also focuses on protecting the elderly and people with disabilities, according to ET. For transactions exceeding Rs 50,000, the RBI has proposed introducing an additional verification step, which may include approval from a pre-appointed trusted individual.
Data indicates that approximately 92% of fraud losses by value occur in transactions above this level, often associated with impersonation and social engineering fraud. Among other measures, the Reserve Bank of India has proposed giving users more direct control over their banking activity. Customers can be allowed to turn specific payment channels on or off, set their own transaction limits, and activate a “kill switch” to instantly stop all digital payments.
This feature may be provided through mobile banking, online banking, bank branches, and interactive voice response (IVR) services. To address misuse of bank accounts by fraudsters, commonly referred to as mule accounts, the central bank has proposed capping annual credits at Rs 25 lakh for accounts that have not undergone enhanced due diligence, the financial daily reported. Accounts requiring higher limits will need to provide further verification regarding their business activities and funding sources. These proposals come at a time when digital payment adoption and fraud incidents have risen sharply. Over the past decade, digital transactions have grown at a compound annual rate of 53%. Meanwhile, reported cases of fraud jumped from 2.6 lakh in 2021 to 28 lakh in 2025, with the total value involved increasing from Rs 551 crore to nearly Rs 22,931 crore. This rise has been driven by tactics such as deepfakes, fake call centers and fake account networks.