On 30-06-2025, the Reserve Bank of India’s (‘RBI’) issued advisory directing all Scheduled Commercial Banks, Small Finance Banks, Payments Banks, and Co-operative Banks to integrate the Financial Fraud Risk Indicator developed by Department of Telecommunications (‘DoT’) into their systems to fight against cyber-enabled financial frauds.
DoT welcomed this watershed moment in the fight against cyber-enabled financial frauds that underscores the strategic importance of automating data exchange between banks and DoT’s DIP through API-based integration, enabling real-time responsiveness and continuous feedback to further refine the fraud risk models.
What is “Financial Fraud Risk Indicator”?
✓ The DoT’s Intelligence Unit (‘DIU’) launched Financial Fraud Risk Indicator in May 2025.
✓ It is a risk-based metric that classifies a mobile number to have been associated with a Medium, High, or Very High risk of financial fraud.
✓ Financial Fraud Risk Indicator is:
- A key technology-led, nationally coordinated solution for combating fraud;
- Initiative representing new era of digital trust and scrutiny in India’s financial ecosystem;
✓ The classification was an outcome of inputs obtained from various stakeholders including reporting on Indian Cyber Crime Coordination Centre, National Cybercrime Reporting Portal, DoT’s Chakshu platform, and Intelligence shared by banks and financial institutions.
✓ It empowered stakeholders, such as banks, Non-Banking Financial Companies, and Unified Payment Interface (‘UPI’) service providers, to prioritize enforcement and take additional customer protection measures in case a mobile number has high risk.
✓ The Mobile Number Revocation List (‘MNRL’) is regularly shared by the DIU with stakeholders which details numbers disconnected due to cybercrime links, failed re-verification, or misuse.
How will it help Banks to prevent Cyber fraud?
✓ Financial Fraud Risk Indicator can be used by banks and financial institutions in real time, which helps in declining suspicious transactions and issuing alerts or warnings to customers and delaying transactions flagged as high risk.
✓ Presently, the following leading institutions are actively using Financial Fraud Risk Indicator PhonePe, Punjab National Bank, HDFC Bank, ICICI Bank, Paytm, and India Post Payments Bank.
✓ Financial Fraud Risk Indicators integration with UPI, being most preferred payment method, can help protect millions of UPI users from cyber fraud.
✓ Collaboration with RBI- regulated financial institutions streamlined alert mechanisms and accelerate fraud detection.
✓ Financial Fraud Risk Indicator enures swift and targeted action and enables collaborative efforts between telecom and financial sectors to combat fraud.
✓ Financial Fraud Risk Indicator is anticipated to evolve into a sector-wide standard, ensuring a consistent approach to fraud detection across the financial and telecom sectors.
