Vinod K. Shah
While the Reserve Bank of India emphasizes on the policy of digitization, it has not yet formulated any effective comprehensive policy to protect bank customers from cybercrime. Most of the personal details of customers and their account related information are accessible to others only by banks and insurance companies. But the RBI, Insurance Regulatory and Development Authority have not shown much interest in keeping them safe.
The Government of India is trying to make financial transactions more and more digital in the country. For this, emphasis is being laid on digitizing the financial transactions of banks and post offices not only in urban but also rural areas. Under this, rural sector banks are now instructing their illiterate and less educated customers to do digital transactions as well.
Local banks have now reduced their cash deposit withdrawal counters. Pressure is being put to do transactions up to ten thousand from ATMs and machines instead of cash. But the banks and the government have not made any effective arrangements except formality to introduce the less educated and uneducated customers to the digital bank system.
The passion of the slogan of Digital India given by the Government of India in 2018 is such that digital banking transactions in the country are increasing at the rate of thirty three per cent per annum. Digital financial transactions worth Rs 8.26 lakh crore were done in the country till the month of February 2021-22, which is four times more than the previous financial year. Following the Reserve Bank of India’s recommendation to promote digital transactions in rural areas, the Ministry of Communications and Finance has stepped up its efforts to improve networking in rural areas, make GPRS, PSTN network reach every rural area. The central and state governments are taking the help of the banking system to directly benefit the beneficiaries.
But a survey of a private institution on financial inclusion has also revealed that seventy-one percent of the country’s beneficiaries, which include rural and working laborers, do not have literacy in the banking system at all. These people are able to conduct banking activities with the help of others. Due to this the incidents of cyber fraud have increased rapidly. Under the Financial Inclusion Scheme of the Government of India, zero balance bank accounts were opened across the country, in which seventy percent of the account holders are illiterate rural, banks are pressurizing these account holders to do transactions from Kiosk centers instead of cash counter withdrawals by providing free ATMs. On the contrary, the statistics of increasing financial fraud from customers using digital services are more alarming.
In the last four years, cases of cheating of seven hundred and ninety crore rupees have been registered from 2.5 lakh people of the country. These are the cases which were reported to the police. Whereas every year twenty-five percent such cases are also coming, whose complaint is not being registered. In the state-wise data presented in the Lok Sabha during the four years between the financial year 2018-19 to 2021-22, the ten most vulnerable states in the country – Rs 252.3 crore from 99,339 people in Maharashtra, Rs 82.24 crore from 26,394 people in Haryana, Rs 25,555 in NCR Rs 80.75 crore, Rs 42.88 crore from 15,518 people in UP, Rs 12,628 to 56.45 crore in Karnataka, 10,881 to 28.08 crore in Gujarat, 7,303 to 22.4 crore in Telangana, Rs 4,276 to 35.38 crore in West Bengal and Rs 19.14 crore from 3,739 people in Rajasthan Cyber fraud has happened.
Victims of cybercriminals are account holders of all categories. In this, apart from the elderly, women, youth, government employees and even the IAS officers of the country are included. Most of the people have been victimized through OTP, Hacking, Lottery, Job Scams, Government Schemes, Fake Websites of Private Companies, Banks and Insurance Companies, KYC by Fake Customer Care, Insurance Scams and Fake Apps.
But despite this, the role of banks and insurance companies, including the central and state governments, in preventing cyber crime has not been effective in the interest of the customer. The process of registering a cyber crime FIR in police stations is cumbersome, depending on the behavior of the police constable. This is also the reason that some of the victims of fraud do not even go to file a complaint. The status of the National Cyber Crime Reporting Portal is that the available toll free number is not accessible even after thousands of attempts since 1930.
The process of filing written complaint online is so long that even knowing the educated becomes disturbed. As soon as the complaint is registered, the cyber cell does not have enough technically trained policemen to investigate it. Ultimately, the complaint of the applicant is forwarded to the same local police station for investigation, which at the time of the incident had not even seriously listened to the complaint of the victim.
In the data received from the center, maximum number of cyber scams are being operated from West Bengal, Jharkhand, Haryana, Punjab, Maharashtra and New Delhi. But the police of these states do not cooperate with the police of other states in investigation, arrest of criminals. Madhya Pradesh Police is looking for 1534 virtual wanted, whose mobile numbers and IP addresses are linked to eighteen states.
These criminals are operating criminal networks out of these states. But the police of many of these states do not cooperate in the arrest and investigation of criminals. Nine states of the country have abolished the General Consensus (consensus) received by CBI in the states due to mutual dispute with the Central Government. Due to this, 173 economic offenses cases in these states, which are about Rs 21,074.43 crore, have not been solved.
While the Reserve Bank of India emphasizes on the policy of digitization, it has not yet formulated any effective comprehensive policy to protect bank customers from cybercrime. Most of the personal details of customers and their account related information are accessible to others only by banks and insurance companies. But the RBI and the Insurance Regulatory and Development Authority have not shown much interest in keeping them safe. Their role in protecting the economic interests of customers remains only formal.
Cases of printing their Visa cards abroad against the rules of many big banks of the country have come to the fore. But RBI has failed to take strict action against these banks. Cyber security company Cyber X9 had claimed in a disclosure in November 2021 that data of 18 crore customers had been leaked from Punjab National Bank for seven months. But the bank calmed the matter very lightly, calling it a case of technical glitch.
Often the victim of cyber crime does not even know where to report the fraud. According to the rules of RBI, there is a provision to compensate the loss through the insurance company to the concerned bank if the bank customer who is a victim of fraud informs his bank about the fraud with him within seventy two hours of the incident. But the RBI, including banks, has kept itself away from public publication of these information. Whereas this information should be published on the bank counter. In the resolve of the Government of India, digital transactions can be the measure of development of the country, but for real development, protecting the economic interests of the citizens of the country should also be the priority of the government now.