These are some serious questions that every citizen of India have in their mind while operating a bank account in India. We all citizens should know how to avoid online frauds in India. And how to legally get the money back after becoming a victim.
Fraudsters create new techniques to fool poor and innocent customers of India. Customers many times effortlessly fall prey to their evil intension. With the number of online bank frauds increasing, you need to be careful about your transactions, especially online ones (ATM, debit/credit card pin, debit/credit card details, e-commerce websites, Point of Sales, online banking, UPI.
Who is held responsible?
The safety of bank account, debit and credit cards lies both with the customer also the concerned bank. In July 2017, RBI reviewed the criteria for determining customer liability in certain circumstances and issued some guidelines in the spirit of both customer and the concerned bank.
When bank responsible for Online fraud?
According to Reserve Bank of Indiaโs guidelines, a customer has zero liability if an unauthorized transaction occurs because of two reasons.
Firstly, a bank employee is responsible for the fraud. Therefore, the customer must get his money back whether reported on time or not.
Secondly, third-party breach where the problem lies neither with the bank nor the customer but lies elsewhere in the system. And the customer notifies the bank within three working days of receiving the bankโs communication regarding the unauthorized transaction.
For instance, if a third-party service like a wallet, website or app deducts the amount twice but does not refund it. Later the customer receives a deduction notification from the bank. And then informs the bank within three days that the second deduction was unauthorized.
Are customers liable for online frauds?
The customer is solely responsible for all transaction if a customer has shared their password or any other payment credentials. Bank online frauds in India are increasing, our responsible action can avoid it.
The customer will bear all the losses. That is why itโs important for customers not to share any account-related information with anyone. Meanwhile, inform the banks as soon as any fraud in the bank account is noticed.
As per the Reserve Bank of India (RBI), if the transaction fault happens due to a third party. And the customer notifies the bank within three working days. In that case, the customer is not responsible in any way.
RBI role in protecting consumers?
Customer interest has always been the overriding principle for the Reserve Bank of India (RBI), Indiaโs Central Bank. Some initiatives introduced decades ago in payment systems to safeguard the interests of customers are valid even today.
Additional Factor of Authentication, Online Alerts like e-mail/SMS alerts, digital ombudsman, internal ombudsman security for card transactions, EMV Chip and PIN cards.
Facility to switch on / off transaction rights, Positive Confirmation, Harmonisation of Turn-Around-Time (TAT) for failed transactions, e-Mandates / Standing Instructions – Cards / Unified Payment Interface / Prepaid Payment Instruments, Cash withdrawals at merchant locations using Point of Sales and UPI, Online Dispute Resolution (ODR) etc.
The security added to transactions has increased the customer confidence in Payment and Settlement Systems.
The number of complaints and disputes increased is an expected outcome of the exponential rise of digital transactions.
The most efficient option to handle such instances are low in proportion may be. It is to have recourse to technology-driven dispute redressal mechanisms that are rule-based, transparent, customer-friendly and involve minimum (or no) manual intervention.
Given the complexity in implementing such an Online Dispute Resolution System (ODR System) across various payment systems, In August 2020, a system announced a phased approach to implementing an ODR System for failed and fraud transactions in all authorized Payment.
A system announced in August 2020 a phased approach to implementing an ODR System for failed and fraud transactions in all authorized Payment.
Based on the experience gained, the ODR arrangement will later extend to cover disputes and grievances other than those related to failed and fraud transactions.
Why customers should be alert while performing online transactions?
Banks always give their customers ample warning from time to time.
For instance, that they shouldnโt share their debit/credit card details or bank account details with anyone.
The bank always put advisories, guidelines on the notice board, and cautionary messages across social media. Also, message customers, informing them that no bank employee will ever call asking for any card details.
In simple words, the bank never asks for any details from their customers. Therefore, customers should strictly follow the guidelines for safe transactions by the bank. Our awareness will save us and help us to lower online frauds in India.