The RBI introduced a new compensation framework for digital fraud victims to address rising concerns over cyber-fraud in banking transactions
GS3Economy · S&T · Environment · Security· Monetary policy, RBI & banking· Prelims + Mains·
Why in news
The RBI introduced a new compensation framework for digital fraud victims to address rising concerns over cyber-fraud in banking transactions.
Background
The RBI framework provides compensation up to 85% of the loss, capped at a maximum of ₹25,000. Additionally, the RBI's forex swap facility for FCNR(B) accounts covers only the principal amount of the deposit.
Facts for Prelims
- BodyRBI: The central bank of India responsible for monetary policy and banking regulation
- FactRBI digital fraud compensation: Up to 85% of loss, capped at ₹25,000
- FactIndia's bitumen imports: Over 99% sourced from West Asia
- SchemePM-VBRY: Pradhan Mantri Viksit Bharat Rozgar Yojana supports first-time job seekers and employers
- FactFCNR(B) forex swap: Covers only the principal amount of the deposit
For Mains
Q. Discuss the measures required to secure the digital payment ecosystem in India while balancing the liability of financial institutions in cases of cyber-fraud.
Dimensions to cover in your answer
- Liability asymmetry: Determining the extent of bank vs. customer responsibility in sophisticated phishing attacks
- Regulatory friction: Balancing rapid fintech innovation with robust consumer protection frameworks
- Infrastructure gap: Need for standardized real-time fraud detection across diverse banking interfaces
Keywords: Cyber-security · Consumer Protection · Digital Payments · Monetary Policy · Financial Inclusion
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