CURRENT AFFAIRS
CURRENT AFFAIRS
Description
In a significant move to secure India's expanding digital financial ecosystem, the Department of Telecommunications (DoT) has introduced a new analytics-driven tool called the Financial Fraud Risk Indicator (FRI). Developed under the broader Digital Intelligence Platform (DIP), this initiative is designed to detect, flag, and prevent fraudulent activities linked to mobile numbers particularly those used in digital banking and Unified Payments Interface (UPI) transactions.
On May 21, 2025, the DoT formally rolled out the FRI tool for use by financial institutions. This decision comes in response to a surge in cybercrimes involving mobile numbers exploited in online financial frauds. With digital payments becoming the norm across India, especially through UPI, the government aims to fortify the country’s financial cybersecurity framework through proactive interventions.
Key Goals Of Financial Fraud Risk Indicator (FRI)
Detect Mobile-Based Financial Fraud: FRI is designed to identify phone numbers associated with suspicious or criminal digital activities.
Enhance Early Warning Systems: The tool provides real-time risk alerts to financial entities before transactions occur.
Strengthen Digital Transaction Security: Through risk-based categorization and alerts, FRI enables institutions to conduct additional checks before processing payments.
About Financial Fraud Risk Indicator (FRI)
The FRI is a data-driven risk evaluation system that classifies mobile numbers into three risk categories:
Medium Risk
High Risk
Very High Risk
This classification is derived from:
Complaints logged via the National Cybercrime Reporting Portal (NCRP)
Insights from the DoT’s Chakshu cyber alert platform
Reports submitted by banks, UPI operators, and NBFCs
The flagged numbers are compiled into a centralized Mobile Number Revocation List (MNRL) and shared with key financial players to enable preventive action.
System Operates
The Digital Intelligence Unit (DIU) of the DoT coordinates the identification and distribution of high-risk numbers. Here's how it works:
Collection of Data: Inputs come from NCRP, Chakshu, and financial institutions.
Risk Evaluation: Numbers are evaluated and ranked by risk level.
Alert Distribution: FRI alerts are sent in real-time to: Banks, UPI platforms, NBFCs
Action: Transactions involving high-risk numbers may be blocked, delayed, or flagged for manual review.
Industry Adoption: Use Cases In Action
PhonePe
Integrates PhonePe Protect to automatically decline very high-risk transactions.
Warns users of potential risk in real-time before medium-risk UPI payments.
Paytm & Google Pay
Deploy delayed transaction features and user alerts when flagged numbers are involved.
Banking Institutions
Use FRI alerts to freeze or hold suspicious transfers, particularly high-value or high-risk ones.
Initiative Is Crucial
Rising Digital Fraud Cases: With digital payment volumes growing rapidly, protecting users from mobile-based fraud is a top priority.
UPI's Dominance: UPI currently leads India’s payment landscape, handling billions of transactions monthly.
Cross-Sector Collaboration: FRI fosters stronger partnerships between the telecom and financial sectors for coordinated fraud response.
Building Public Trust: Proactive security measures help enhance consumer confidence in digital finance.
Conclusion
The launch of the Financial Fraud Risk Indicator marks a decisive step in India’s fight against financial cybercrime. By enabling real-time fraud detection and multi-institutional cooperation, this system not only strengthens the country’s cybersecurity defenses but also reinforces trust in its fast-growing digital economy.
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