A During the COVID-19-induced lockdowns, digital modes of payments have gained a lot of popularity as they simplify financial transactions and digital payments. Customers benefit from digital payments but this also invited many fraudsters constituting a considerable percentage of white-collar offenses being probed by the police. Dealing with risks associated with fraud is on no bank’s wish list, but it is a fact that fraud land financial crime across the globe is expected to rise in answer to the uncertainty in the business landscape.
A competent banking system is required for any country’s economic growth and now the banking industry is thriving, yet it is experiencing certain operational issues like scams. With a plethora of economic variables at play, the banking sector’s role has evolved and has been at the forefront of fraud mitigation strategies, prescribing the frameworks that banks need to adopt to have a better view of fraud risks. But still, the amount of money lost to bank fraud is increasing and the amount misappropriated in these crimes runs into lakhs and crores of rupees. The Reserve Bank of India and bank management are both concerned about the banking customers and try to make them aware of digital payments-related frauds and for that the RBI has published a booklet that pours light on such scamsters. Bank fraud is a federal crime that also invited many fraudsters to make use of gaps and dupe the customers in different ways and this unfavorable trend in the financial system results in a deterioration of their trust. Beware of banking frauds and here’s a closer look at some of the different types of banking frauds.

Card skimming

Card skimming is a type of theft or bank fraud where the criminal makes use of the skimming devices to steal card information. This skimmer is usually installed in the POS machine or ATM for obtaining personal data from ATM, debit, or credit cards and then use to create a duplicate card to withdraw money from the customer’s account through an ATM or a merchant location. The electronic device captures and stores key information from the magnetic strip of your credit/debit card, so once you recognize the threat it’s advisable to replace your magnetic plastic card with a chip-based card.


Phishing is an online scam and one of the major global problems faced by Banks worldwide. It is an attempt to ‘fish’ for your banking details where “phishers” gain customer account information such as user names, passwords, PINs, or Social Security digits. Fraudsters create a phishing website with pop-ups or links that appear to be from known institutions like banks, popular e-commerce websites, search engines, government agencies, etc. Through these deceptive communications, the fraudsters distribute links to different websites by SMS, social media, email, Instant Messenger, etc, and gain your confidential information.

Theft of identity

Identity theft is a type of fraud where someone acquires personal, critical, and essential information of another individual, typically comprising personal or financial data such as your Social Security number or bank account number, and then uses this information to indulge in any irregular action. Identity theft protection is a growing industry and its victims are typically left with damage to their credit, finances, and reputation.

Impersonation on social media

With lots of people spending time on social media and updating their details it is simple for scammers to obtain this information to defraud users. When a person pretends to be someone else on social media platforms by faking a profile, they use social engineering to target people by sending requests to the users’ friends for extracting money and other sensitive information.

Fraud via QR code scan

It is a common ploy of fraudsters using a variety of ruses persuading you to scan Quick Response (QR) codes using the apps on your phones and the goal of QR code extortion is pretty much often the same. Using false information, fraudsters can also approach users and slowly win their trust, then navigate to a page through which cyber criminals steal your data or money.

SIM swap or SIM cloning

SIM swap or SIM cloning happens when scammers or fraudsters find loopholes in the two-factor authentication and verification and take over the control of your mobile operations from your existing SIM to another SIM. Through SIM hijacking, fraudsters generally collect personal or identity details from the customer to carry out unauthorized transactions.