Nikhil Kamath Urges RBI To Tackle Rising Threat Of Fake Payment Apps

SUMMARY

Kamath has raised concerns with the RBI over the rising threat of fake apps impersonating banks, brokers, and payment platforms

This comes days after the RBI rolled out the exclusive internet domain ‘bank.in’ for Indian banks, an initiative designed to combat cybersecurity threats and fraudulent activities like phishing

The RBI aims to streamline financial services and enhance trust in digital banking and payment platforms by providing a secure and verified domain

Zerodha cofounder Nikhil Kamath has raised concerns with the Reserve Bank of India (RBI) over the rising threat of fake apps impersonating banks, brokers, and payment platforms.

“The sheer number and variety of digital frauds is astounding. It’s fair to assume that things will only get much worse from here, thanks to AI. Both SEBI and RBI are trying to educate people and implement measures to combat these frauds,” Kamath said in an X post.

He added that SEBI has published a consultation paper proposing unique UPI IDs for brokers to ensure investors transfer money only to SEBI-registered brokers, preventing scams involving fraudulent UPI IDs that mimic broker names.

Beyond payment and website fraud, another major concern is the rise of fake apps posing as banks, brokers, and payment platforms. Kamath emphasised the need for urgent action to tackle this issue as well.

This comes days after the RBI rolled out the exclusive internet domain ‘bank.in’ for Indian banks, an initiative designed to combat cybersecurity threats and fraudulent activities like phishing.

The RBI aims to streamline financial services and enhance trust in digital banking and payment platforms by providing a secure and verified domain.

The Institute for Development and Research in Banking Technology (IDRBT) serve as the exclusive registrar, with registrations set to begin in April 2025.

During the time of the announcement, RBI Governor Sanjay Malhotra stated that detailed guidelines for banks would be issued separately. He also mentioned that the RBI planned to extend this approach to non-bank entities in the financial sector with an exclusive “fin.in” domain in the future.

This latest initiative adds to a series of measures the RBI has taken to prevent cyber fraud. In its last MPC meeting on December 6, 2024, the RBI introduced an AI/ML-powered model called MuleHunter.AI to detect mule bank accounts.