5 Online Payment Fraud Stories That Scared Indians in 2019-2020

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Did you know that 1 in 5 people face online payment fraud daily? 

Keeping your purse and wallet tight to your person is not enough anymore. A simple phone call from an unknown caller claiming to be a ‘customer executive’ could lose you your hard-earned money! 

In this blog, we will explore a few such stories that took place to some unfortunate online payment users in India. We will also help you not become one of them. 

Fraud #1  – Bangalore Techie loses Rs. 4 Lakh After Swiping Card at A Bar

Imagine heading to a bar with your friends, paying a bill of Rs. 4,000 using your card, and within minutes, you get a notification; over Rs. 4,00,000 is debited from your account! 

For a 34-year old Bangalore-based techie, this was a reality. A recent case of online payment fraud that swept headlines and scared several online payment users. Varun Gupta headed to a popular brewery in Bangalore with his buddies for a few drinks.

Once the bill appeared before him, he paid a total amount of Rs. 4,000. However, in one hour, Varun Gupta watched in horror as his phone screen showed 10 consecutive transactions in his account. The transactions took place via his debit card, and they were made from New York! 

This online payment fraud is known as skimming. Skimming is used by identity thieves to capture information from a cardholder. Bankers are flummoxed at this fraud and are still looking for the cause of the scam! 

Fraud #2 – Mumbaikar loses 10 Crore in Phishing Scam

In an Economic Times article, a Mumbaikar excitedly opened a link he received via email from the Income Tax Department for his IT refund.

Or that’s what he thought!

Once the man clicked the link, he was redirected to an app. He downloaded the app, which mirrored his bank account details and stole lakhs of money from his bank account. This is phishing, and India is the third country most privy to this kind of online payment fraud. 

Through phishing, hackers access your personal information through fraudulent emails and websites that are ‘legitimate’. They can source your username, passwords, credit card numbers or Bank Account numbers this way. 

Fraud # 3 – 69-year-old Doctor from Mumbai robbed of Rs. 17 Lakh in KYC Scam 

Dr Prakash Madhav Amberdekar lives in Mumbai. He received a call from a ‘bank executive’ who requested him to link his bank accounts to his e-wallet to avail benefits. The doctor unwittingly shared his bank details over the phone call to the executive. 

Within minutes, he began to receive SMSes providing OTP details. The doctor grew suspicious and immediately changed his net banking password. The caller hung up and an aggrieved Dr Prakash blocked his net banking account. 

However, this did not deter the fraudsters, for the doctor’s phone number, was registered with his children’s bank accounts too. One day, the doctor headed to his bank to check the online status of a cheque due for clearing. There, he found out that someone had illegally wires transferred over Rs. 17 Lakhs from both his children’s accounts. 

Fraud # 4 – Designer in Hyderabad gets duped of 6-month savings by UPI scammer 

In a similar case, Livemint reported a story about Sejurti Baral, a Hyderabad-based designer who lost over Rs. 88,000 to a fraudster via UPI (Unified Payments Interface).

Baral wished to sell her old phone using an e-commerce site and was approached by a potential buyer. The buyer sent her a link to a Google form from a new number (not the one registered on the e-commerce site) and asked her to enter her UPI ID and name for him to make the payment.

She claims that when she entered her UPI PIN in the form, the numbers showed up, instead of being hidden as it normally does. Before she realised what happened and deleted the PIN, it was too late. 

Fraud #5 – Man looking to sell furniture, loses Rs. 1 Lakh in Paytm Scam 

Rampant online payment frauds led this innocent Thane resident running to the police station! The man wanted to sell his furniture and posted an ad on Facebook on December 24th. Soon, he received a call from a man named Rajendra Sharma, who agreed to buy the furniture from him. He requested the man if he could make the payment via PayTM or Google Pay. 

The man shared his account details with the man and awaited the credit for the furniture. Instead, his account got debited of Rs. 1 Lakh, in over 3 consecutive transactions! 

The buyer ‘apologised’ and offered to refund his money, and asked to share an alternative account number with him. The man registered a case with the Thane Police under section 420 (cheating) of the Indian Penal Code and Information Technology Act

Tips to prevent online payment fraud: 

  1. Your payment gateway or merchant will never call you via phone or email for your bank details. 
  2. Choose the online payment gateway that your Accountant trusts.  
  3. Do not open any link you receive via email that asks you to download an app. 
  4. Make sure your electronic devices are updated with the latest security software. 
  5. If anyone calls you claiming they are from your Bank/Payment Gateway and asks for your OTP/card details, hang up immediately. 
  6. UPI is the most popular payment mode in India – clocking over 1 billion transactions in December 2019 alone. This makes it a hotspot for fraudulent activity. While UPI is safe, ensure you do not share your UPI ID with unknown people. 
  7. Also, the RBI mandated that all transaction SMSes must carry a customer care number or email that can be reached out to in case of any fraud. 
  8. RBI has mandated e-wallet companies to set up 24×7 customer care helplines to report fraud or any loss or theft. This way, customers are assured of immediate assistance in case of fraud. Furthermore: 
  • File the complaint within 3 days, the entire amount is refunded back to you. 
  • If the fraud is reported within 4-7 days, the transaction value or Rs. 10,000, which is lower, is refunded. 
  • If the fraud is reported after a week, the refund depends on the RBI-approved policy of the e-wallet.

Instamojo payment links are PCI-DSS compliant, which prevents fraudsters from scamming our users. So, if you are looking for a trusted payment gateway, you need not look any further.


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