On March 18, 2025, the Ministry of Finance announced new initiatives aimed at bolstering cybersecurity in the financial sector, focusing on digital transactions and protecting consumers from financial fraud.
The government, in collaboration with various stakeholders such as the Ministry of Home Affairs (MHA), the Reserve Bank of India (RBI), and the National Payments Corporation of India (NPCI), has launched several initiatives to safeguard against cybercrimes and enhance the security of digital payments.
Key Initiatives to Strengthen Cybersecurity:
AI-Based Tool ‘MuleHunter’ by RBI: The RBI has introduced an Artificial Intelligence (AI)-based tool called ‘MuleHunter’. This tool is designed to identify “money mules,” individuals who unknowingly or knowingly transfer illegally obtained money. The tool aims to help banks and financial institutions monitor suspicious activities and prevent financial fraud.
Indian Cyber Crime Coordination Centre (I4C): The Ministry of Home Affairs has established the Indian Cyber Crime Coordination Centre (I4C) to create a framework for law enforcement agencies (LEAs) to address cybercrimes more effectively. This initiative helps enhance coordination among various stakeholders and provides a platform for tackling cybercrimes in a comprehensive manner.
National Cyber Crime Reporting Portal: The National Cyber Crime Reporting portal (https://cybercrime.gov.in) has been launched to allow the public to report all types of cybercrimes, including financial fraud. Reports submitted through this portal are routed to the respective State/UT LEAs for investigation, ensuring timely and coordinated action.
Citizen Financial Cyber Fraud Reporting and Management System: To tackle financial frauds, the Citizen Financial Cyber Fraud Reporting and Management System was introduced. This system allows immediate reporting of financial frauds and helps prevent the siphoning off of funds by fraudsters. So far, Rs. 4,386 Crore has been saved through this initiative, which has handled over 13.36 lakh complaints.
Suspect Registry for Cyber Criminals: In partnership with banks and financial institutions, the MHA has launched a suspect registry to track identifiers of suspected cybercriminals. This initiative aims to improve collaboration between law enforcement agencies and financial entities in identifying and apprehending cyber offenders.
Strengthening Digital Payment Security:
To further secure digital transactions, several measures have been taken:
- RBI’s Master Directions on Digital Payment Security: In February 2021, RBI issued guidelines mandating banks to implement minimum security standards for digital payment systems, including internet banking, mobile banking, and card payments. These guidelines aim to combat threats related to web and mobile applications.
- NPCI’s Security Features for UPI: The National Payments Corporation of India (NPCI) has implemented several security measures for Unified Payments Interface (UPI) transactions. These include device binding (linking the customer’s mobile number to a device), two-factor authentication through PIN, transaction limits, and restrictions on specific use cases.
- AI/ML-Based Fraud Monitoring: NPCI provides a fraud monitoring solution to banks using AI and machine learning models to generate alerts and decline suspicious transactions. This proactive measure helps prevent fraud and ensures the safety of digital transactions.
Public Awareness Campaigns:
In addition to technological measures, RBI and various banks have been conducting awareness campaigns to educate the public about cybersecurity risks. These include sending out SMS alerts, conducting radio campaigns, and spreading publicity on preventing cybercrime through various channels.
Conclusion:
These initiatives reflect the government’s proactive approach to enhancing cybersecurity in the financial sector. By combining cutting-edge technologies like AI with improved coordination between law enforcement and financial institutions, India aims to create a safer environment for digital transactions and protect consumers from the growing threat of cyber fraud.
