A new cyber fraud method linked to the Aadhaar Enabled Payment System has raised concern over the safety of digital banking transactions, with fraudsters reportedly siphoning money from bank accounts without OTPs, bank calls or card usage. The scam allegedly exploits biometric verification systems, allowing unauthorised withdrawals that victims may not detect until after financial losses have occurred.
AI-Based Biometric Exploitation Under Scrutiny
The Aadhaar Enabled Payment System allows transactions using Aadhaar numbers and biometric verification such as fingerprints or facial authentication. Cyber fraudsters are reportedly exploiting vulnerabilities in this system to gain access to bank accounts and withdraw funds without triggering traditional security alerts.
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Cybersecurity experts have warned that artificial intelligence is being used in this fraud model. Criminals are allegedly creating fake facial models using photos or videos of individuals to bypass AEPS authentication systems. Once the fake biometric data is accepted, money can be withdrawn directly from victims’ accounts.
Security Gaps Raise Fresh Banking Concerns
The most serious concern is that such transactions do not require OTPs, passwords or call-based verification. As a result, account holders may remain unaware of the fraud until significant losses have already taken place.
Experts say the scam, increasingly described as a “silent banking scam,” highlights the limitations of traditional banking security layers in cases where biometric systems are exploited. The rise in such incidents has placed pressure on financial institutions and enforcement agencies to strengthen safeguards around digital identity and biometric data.
Experts Urge Caution and Faster Reporting
Cybersecurity specialists have advised users to use AEPS only when necessary. Those who do not require the service have been encouraged to contact their banks and request deactivation or restriction.
Cybercrime expert and former IPS officer Triveni Singh has warned that cybercriminals are exploiting both human behaviour and weaknesses in biometric systems. He said AI-based identity spoofing and biometric cloning could become major digital threats in the coming years.
The Future Crime Research Foundation has also warned that AEPS-related frauds and biometric exploitation cases may increase further in India with the misuse of artificial intelligence technologies. Under the government’s “Cyber Dost” initiative, citizens have been urged to keep Aadhaar and biometric data secure.
In case of suspicious banking activity, users have been advised to call the national cyber helpline number 1930 and inform their respective banks. Experts also recommend enabling SMS alerts, transaction notifications and banking alerts, along with regularly updating passwords and security settings.
