In India, UPI (Unified Payments Interface) has become the go-to method for digital transactions, but with this rise in usage, UPI frauds are also increasing. Over 95,000 UPI fraud cases were reported in the 2022-23 financial year. Understanding how these scams work is your first step toward staying safe. Here’s everything you need to know about UPI frauds and how to protect yourself from falling victim to them. UPI (Unified Payments Interface) was launched on April 11, 2016, by the National Payments Corporation of India (NPCI). It was introduced to make digital payments easier and faster in India. Key figures in its creation included Dr. Raghuram Rajan, the RBI Governor at the time, and Nandan Nilekani, former chairman of UIDAI.
Multiple UPI payment app’s
Google Pay is a widely used app that offers seamless UPI payments and integration with multiple banks: –
- Phone Pay – One of the leading UPI apps with features like bill payments, recharges, and money transfers.
- Paytm – Known for various services beyond UPI, such as mobile recharges, shopping, and financial products.
- Amazon Pay – Amazon’s payment platform also supports UPI for easy transactions.
- BHIM (Bharat Interface for Money) – An app developed by the Indian government to promote UPI adoption, specifically aimed at simplifying digital payments.
Know About UPI Fraud?
UPI fraud happens when someone tries to trick you into revealing your UPI PIN or personal information, so they can steal money from your bank account. Fraudsters use a variety of tricks to gain access to your UPI details and carry out unauthorized transactions. 
Multiple Types of UPI Frauds
- Vishing (Voice Phishing)
Vishing (Voice Phishing) is when scammers trick people over the phone to steal personal information, like bank details or passwords. The scammer might pretend to be someone trustworthy, like a bank employee or a government official, and try to get you to share sensitive information. For example, they might call you saying there’s an issue with your bank account and ask for your account number, or claim they need to fix a problem with your computer and ask for remote access. Always be cautious about unsolicited calls and never give out personal details over the phone unless you’re sure of the caller’s identity.
- Fake UPI Payments or Transfers
Fake UPI payments refer to scams that fraudsters use to trick people into believing that they have received money or manipulate them into transferring money. Scammers use fake payment links, screenshots, and misleading payment requests to steal money. The fake UPI payment is a concern for UPI users.
- Fake UPI QR Codes
Fraudsters create fake QR codes that lead to phishing sites or malicious apps. When you scan these codes, they steal your UPI details.
- Impersonation
Scammers pose as bank staff or customer service agents to trick you into sharing your OTP or UPI PIN. The penalty for identity theft is imprisonment for up to three years and a fine of up to one lakh rupees. Impersonation: Impersonation is an offence under Section 416 of the IPC.
- Fraud Sellers
Seller fraud happens when a seller tricks or deceives a buyer to make money unfairly. This could include things like:
- Taking payment but not delivering the product.
- Selling fake or damaged items while claiming they’re real or in good condition.
- Providing false or misleading information about the product to get a sale.
- Screen Monitoring Apps
Some scammers use apps that secretly monitor your screen to capture sensitive information like your UPI PIN or OTP. They’re often used by parents to monitor kids, employers to watch employees, or for security purposes. They can capture screenshots, track apps, and even log keystrokes.
- SIM Cloning
SIM cloning is when someone makes an exact copy of another person’s SIM card. A SIM card is a small chip in your phone that stores important information, like your phone number and contacts. Cloning a SIM card means creating a duplicate of that information, so someone else can use your phone number and access your calls, texts, and other services, usually without your permission. It’s a form of identity theft or fraud, and it can lead to privacy violations or financial loss.
- Malware
Malware is short for “malicious software.” It’s a type of harmful software designed to damage, disrupt, or steal information from your computer, phone, or other devices. Think of it like a virus or a sneaky bug that gets into your device without you knowing and causes problems. Malware can steal your data, like passwords or credit card numbers, or it can slow down your device and make it stop working properly.
- Money Mule
A “money mule” is someone who is used by criminals to transfer stolen money or illegal funds. In simple terms, it’s like being a middleman who helps criminals move money, often without knowing that it’s illegal. Here’s how it works: A criminal might trick someone into accepting money in their bank account or through other methods, then ask them to send that money to someone else, often overseas. The person doing this is called a “money mule.” They might think they are helping with a legitimate job or transaction, but in reality, they are unknowingly part of a crime.
- Deceiving UPI Handles
“Deceiving UPI handles” refers to fake UPI (Unified Payments Interface) IDs that are designed to trick people into sending money to the wrong account. In simple terms, scammers create UPI IDs that look very similar to the ones of trusted people or organizations, like a friend or a well-known business. When someone tries to send money to the correct person, they accidentally send it to the scammer’s fake account instead. So, “deceiving UPI handles” are essentially fake payment IDs that are made to deceive and steal money from people.
- Collect Request Fraud
“Collect Request Fraud” is a type of scam where a fraudster tricks someone into paying money by sending them a “collect request” through a payment platform, like UPI or other apps. Here’s how it works: The scammer sends a request to the victim asking for money, often pretending to be a friend, a company, or even a delivery service. The victim receives the request and thinks it’s legitimate, so they approve the payment, unknowingly sending money to the scammer.
How Hackers Pull Off UPI Fraud
Here’s how scammers usually operate, explained in simple terms:
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Fake Calls or Messages
Scammers pretend to be from your bank or UPI service and call or message you. They might say there’s an issue with your account and ask you to share personal details like your UPI PIN or OTP. Don’t ever share this information over the phone or in messages.
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Phishing Links
They send you fake links, pretending it’s from your bank or a trusted website. When you click on the link, you’re taken to a fake site that looks real. If you enter your details, they steal your information.
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SIM Card Swap
Scammers sometimes trick your mobile provider into switching your SIM card to a new one. Once they control your number, they can get your OTPs and make payments without you knowing.
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Fake UPI Apps
They might trick you into downloading fake apps that look like the official UPI apps. Once you use them, they steal your bank details and other personal information.
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QR Code Scams
Scammers send you fake QR codes and ask you to scan them to make a payment. But when you do, the money goes to their account, not the person you’re trying to pay.
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Impersonating Friends or Family
Sometimes, scammers hack into your friends or family member’s account or impersonate them. They might ask you for urgent money, and since it seems like someone you know, you might send them money, only to realize it’s a scam.
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Fake Offers or Refunds
They might offer fake discounts, prizes, or refunds and ask you to pay a small fee through UPI to claim it. After you pay, you get nothing in return.
How Avoid UPI Fraud
Here are some simple and easy ways to avoid UPI fraud:
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Keep Your UPI PIN Safe
Never share your UPI PIN with anyone. If someone, even from your bank or service provider, asks for it, it’s likely a scam. Keep your PIN private and secure.
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Avoid Suspicious Calls or Messages
If you receive a call or message from someone claiming to be from your bank or UPI service, and they ask for personal information, be cautious. Banks will never ask for your PIN, OTP, or any sensitive details over the phone. Ignore such messages or calls.
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Beware of Phishing Links
Do not click on links from unknown sources. These links may lead to fake websites where your personal information can be stolen. Always use trusted websites and apps for transactions.
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Avoid Unknown Apps
Download UPI apps only from trusted sources like the Google Play Store or Apple App Store. Fake apps can steal your personal and banking information.
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Be Careful with QR Codes
When making payments via QR codes, always verify that the code is correct. Scammers might send fake QR codes, directing your payment to their account instead of the intended recipient.
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Regularly Check Your Bank and Transaction History
Keep an eye on your bank account and UPI transaction history. If you notice any suspicious transactions, contact your bank immediately.
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Lock Your Phone with a Password
Always lock your phone with a strong password, PIN, or fingerprint. This ensures that your information stays safe if your phone is lost or stolen.
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Enable Two-Factor Authentication (2FA)
Whenever possible, enable two-factor authentication (2FA) for your UPI apps and bank accounts. This adds an extra layer of security to your accounts.
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Never Pay for Fake Offers or Refunds
Never make payments for too-good-to-be-true offers or fake refunds. If someone promises you something unrealistic, always verify before paying.
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Only Send Money to Trusted People
If someone you don’t know asks you for money, always verify their identity before transferring funds.
By following these simple steps, you can protect yourself from UPI fraud. If something feels suspicious, always check and verify before taking any action.
Conclusion
UPI fraud is a growing concern, but by staying alert and following safety tips, you can protect yourself. Always verify details, use official apps, and never share sensitive information. Being cautious while making payments can go a long way in avoiding financial loss. Stay safe, stay smart, and help others be aware too. Prevention is always better than dealing with fraud later.
