Amid a surge in digital fraud cases, the Reserve Bank of India on Thursday announced a one-time compensation of up to ₹25,000 for bank customers who fall victim to fraudulent digital transactions, even if the customer has inadvertently shared a one-time password (OTP).
Reserve Bank Governor Sanjay Malhotra said the compensation will be paid from the ₹85,000-crore Depositor Education and Awareness (DEA) Fund. The facility will be available only once in a lifetime for each customer, provided no malafide intent is detected.
“A customer will be compensated as long as the transaction was unintended and the money has been lost. Whether the fraud occurred on the customer’s own accord or otherwise, no questions will be asked,” Malhotra said.
However, customers will have to bear 15 per cent of the fraud amount even when the loss is below ₹25,000. In cases involving higher-value frauds, compensation will be capped at ₹25,000.
RBI officials said nearly two-thirds of all digital fraud cases involve amounts of less than ₹50,000, even though their overall value is relatively low, indicating that a large number of affected customers are likely to benefit from the proposed framework.
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Deputy Governor Swaminathan J said the compensation will be funded through the DEA Fund, which also comprises unclaimed bank deposits lying dormant for more than 10 years.
“It is that segment which unwittingly becomes a victim of such frauds that we are trying to cover. The financial impact of compensating such cases may not be very high,” he said.
The RBI will shortly release a draft of the compensation framework for public consultation, Malhotra added.
Separately, Deputy Governor Shirish Murmu said awareness campaigns urging depositors to reclaim unclaimed deposits have improved recovery, with the run rate now at around ₹5,000 crore per year.
The RBI also announced plans to introduce additional safeguards to prevent fraud, including delayed credit to beneficiary accounts and enhanced authentication mechanisms, particularly to protect senior citizens from being duped.
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