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How to safeguard oneself against online financial frauds


There are a staggering number of online transactions that take place each day in India. This not only helps the banking sector and the consumers but in general gives the economy a boost too.

Just as in real life when you transact, there is a chance of getting robbed, so can it be online. Fraudsters in the cyber space have been active ever since the internet was invented. However, gradually the cyber frauds have become quite complex. Now, fraudsters not only use the latest technology, but also psychological tactics to try and separate you from your money. While they do get away at times, there are several ways to prevent them from doing so and keep your money safe.

While banks are continuously investing in the latest technologies and working tirelessly to increase consumer awareness, it is up to the consumers, too, to do their bit and always be vigilant by using some very basic techniques.

Here’s looking at the cyber financial fraud risks that consumers may encounter and how they can avoid falling for cyber fraud.

Identity theft: In this type of cyber fraud, a customer’s personal information is used by a fraudster to access their bank account without their permission and withdraw money without the customer realizing it. To safeguard against such a threat, a good place to start is by using strong passwords, namely alphanumeric and changing them regularly.

Ransomware attack: A ransomware attack is when a fraudster takes over a user’s computer or phone with advanced encryption and demands money to release the data. The payment occurs mostly through coupons or through cryptocurrency.

To avoid ransomware attacks, never click on unsafe links that you receive in spam emails or unknown websites. Often, scammers call pretending to be from a bank or some credible institution and ask users for their personal details. Never give these out, either over a call or on mail. Avoiding using unknown USB sticks is another way to defend oneself from these attacks. Finally, use VPN services whenever logging on to a public network as it makes you less vulnerable.

SIM swap: This is a very sinister type of fraud where the scammers can move large amounts of money without user’s knowledge. It starts by the fraudster getting a user’s personal details through phishing or by cold calling people under some pretext. These are then used to contact the mobile provider and port the SIM to the fraudster and thereby clone the SIM card. After this, the user loses connection to the network and the scammer can access the user’s bank account by receiving OTPs and withdrawing/ transferring as much money as they can.

A simple way to be safe from a SIM swap fraud is to never share any personal information online with sources you don’t trust. Use strong passwords and security questions and never give out any details to anyone who will call you posing as a bank employee or some other professional. A bank or any other professional institution will never ask you for your personal details.

QR code scan scam: This scam is mostly undertaken when the receiver of money is asked to scan the QR code to get the amount credited in his or her bank account. Once the QR code is scanned, the amount is deducted instead of getting credited in the bank account. Most of the times, the fraudster poses as someone from a respected profession. Once the receiver scans the code and enters the UPI pin, the sender can immediately withdraw large amounts of money from the user’s account.

While using QR codes has become a norm, never agree to scan a code from someone you don’t know. Scanning QR codes at malls and stores or restaurants is okay, but you need to trust the receiver. Never ever enter your UPI pin to receive money from anyone. You will never be asked for your UPI pin to receive money; it’s only used to pay money.

Always remember to update your phone and computer’s system security and be vigilant while transacting online. Be in touch with your bank on a regular basis and update yourself on the latest security measures undertaken by them. The RBI, on its part, has been consistent in educating customers about banking security. Now, it is up to the consumers to be aware and vigilant.

Pinakin Dave is country manager – India and SAARC, OneSpan

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