Authors: Aniket Garg
Abstract: The rapid growth of the Indian digital payments ecosystem which is controlled mainly by the Unified Payments Interface (UPI) has improved financial inclusion whilst alleviating transaction friction. Meanwhile, the magnitude, speed, and functionality of UPI have increased vulnerability to phishing, impersonation, scams, and synthetic identities, mule accounts, and AI-enforced social engineering. The paper under consideration investigates the UPI fraud proliferation in India through the qualitative analysis of official circulars, payment data, cybersecurity reports, and the latest regulatory interventions. It has been shown in the analysis that user confusion, ineffective verification conduct, quick payment rails that cannot be reversed, and more advanced threat agents are the proximal factors influencing the rise in fraud. A multi-level framework of prevention that incorporates beneficiary authentication, concatenation of devices, behavioural danger rating, mule-account recognition, consumer knowledge, and amplified inter-institutional reports is proposed. The paper concludes that future achievements in minimizing fraud through the integration of scale-induced innovation with security-by-design and timely redress framework will be dependent on it. [1], [3], [4], [5].
DOI: https://doi.org/10.5281/zenodo.19910031
