Online banking and plastic card-related fraud in India increases 35 percent

Various Indian government agencies are taking measures to prevent cyber attacks, scams, and net banking fraud, with 11,997 reported cases in the first nine months of 2015-16 alone.
Written by V L Srinivasan, Contributor

The incidence of ATM, credit, debit card and net banking-related fraud has gone up by more than 35 percent between 2012-13 and 2015-16 in India, according to country's federal bank Reserve Bank of India (RBI).

According to RBI data, 8,765 cases were reported by banks in 2012-13 and the corresponding figures for subsequent three years were 9,500 (2013-14), 13,083 (2014-15) and 11,997 (in the first nine months of 2015-16) respectively. India ranked third after Japan and the US as countries most affected by online banking malware in 2014.

These cases may be miniscule for a country like India whose population is more than 1.2 billion but there should be no room for complacency as the government moves towards digitising the country and wants every citizen to have a bank account.

Indian Minister for Communication and Information Technology Ravi Shankar Prasad said that several cyber attack techniques were being used in combination while committing scams and net banking fraud.

"The fraudulent activities comprising of phishing, lottery scams, ATM/Credit Card frauds, internet banking frauds, and other banking frauds involve usage of email to trick the users to steal victims' identity credentials and commit fraud," he told the Indian Parliament a few days ago.

The Indian Computer Emergency Response Team (CERT-In), the nodal agency to look into the reports regarding phishing incidents affecting users of online banking, has tracked 534 phishing incidents in the first nine months of 2015. Of them, the phishing websites relating to 342 incidents were hosted in countries outside India.

"Details regarding involvement of scams using IP addresses from abroad are not available with RBI, but the country's premier investigation agency -- the Central Bureau of Investigation (CBI) -- has registered one case in 2014 involving IP address outside the country," the minister added.

Among the various steps taken by the government to prevent cybercrimes and scams included setting up cybercrime cells across the country, and opening cyber forensic training and investigation labs in Kerala, Asom, Mizoram, Nagaland, Arunachal Pradesh, Tripura, Meghalaya, Manipur, and Jammu & Kashmir, the minister added.

A joint study entitled "New Age Crime" conducted by the Associated Chambers of Commerce and Industry of India (ASSOCHAM) and Mahindra SSG recently pointed out that India needs to invest at least $4 billion in public-private partnership (PPP) mode to address cybercrime-related challenges at both individual and organisational levels.

The investment has to be spread across upgrading technology, training cyber professionals, counselling of victims, creating cyber cells and others, the study pointed out. With the country facing acute shortage of cybersecurity professionals in India, there was a need for the government to reallocate the resources on cybersecurity projects. This will help the government to keep on such unscrupulous activities, the study added.

However, another report entitled Cyber and Network Security Framework, an ASSOCHAM-Mahindra SSG study, last year revealed that the total number of cybercrimes in all sectors could be around 300,000 in 2015, almost double the level of previous year, causing havoc in the financial space, security establishment, and social fabric.

"Phishing attacks of online banking accounts or cloning of ATM/debit cards are common occurrences. The increasing use of mobiles/smartphones/tablets for online banking and financial transactions has also increased the vulnerabilities to a great extent. The maximum offenders came from the age group of 18-30," the report said.

ASSOCHAM Secretary General D S Rawat said that the origin of these crimes was widely based abroad, including the US, Europe, Brazil, Turkey, China, Pakistan, Bangladesh, the UAE and Algeria among others. As per the findings, nearly 12,456 cases were registered every month in India.

With increasing use of IT-enabled services such as e-governance, online business, and electronic transactions the protection of personal and sensitive data has assumed paramount importance.

"The economic growth of any nation and its security, whether internal or external, and competiveness depends on how well is its cyberspace secured and protected", Rawat said in a statement.

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