'85% Coverage': RBI Issues Draft Digital Fraud Compensation Guidelines

The Reserve Bank of India (RBI) has unveiled draft guidelines for a new compensation scheme designed to safeguard customers against digital fraud. Under these proposed regulations, consumers could receive reimbursement of up to 85% of the amount lost due to fraudulent activities, with a cap set at 25,000 rupees (approximately $272). This initiative is part of the RBI's ongoing efforts to enhance consumer protection in the rapidly growing digital payment landscape. As online transactions become increasingly prevalent, the risk of fraud has also escalated, prompting the RBI to take proactive measures. Stakeholders, including banks and financial institutions, have been invited to provide feedback on these draft guidelines, which aim to create a more secure environment for digital transactions. The RBI's move is expected to bolster consumer confidence in digital payment systems, encouraging more individuals to engage in online financial activities while ensuring they have recourse in the event of fraud. This initiative reflects the central bank's commitment to fostering a safe and reliable digital economy in India.