The Reserve Bank of India (RBI) on June 30 directed all scheduled commercial, small finance, payments, and co‑operative banks to integrate the Department of Telecommunications’ (DoT) Financial Fraud Risk Indicator (FRI) into their transaction systems. The decision signals a new phase of inter-agency collaboration against pervasive cyber-enabled fraud.
What the FRI Does—and Why It Matters
Launched by DoT’s Digital Intelligence Unit in May 2025, the FRI classifies mobile numbers as medium, high, or very high risk based on multi-agency intelligence data from the National Cybercrime Reporting Portal, DoT’s Chakshu platform, telecom revocations, and banks’ own reports. Through secure, real-time API integration, banks and fintech platforms like PhonePe, Paytm, HDFC, ICICI, PNB, and India Post Payments Bank can now pause or reject transactions linked to flagged numbers, alert customers, or delay suspicious transfers.
This empowerment is especially critical in a surge of digital financial fraud. By enabling pre-emptive blocks or warnings at the transaction stage, the FRI gives financial institutions a sharper, data-backed early warning system.
Systemic Boost to Digital Trust
Authorities hailed the directive as a “watershed moment” in AI-informed fraud defence and fintech regulation. It addresses growing concerns over systemic vulnerabilities, such as those highlighted in the RBI’s earlier alert on cyberattacks targeting banks and NBFCs from foreign threat actors. Equipping all banks—not just large players—with this tool marks a shift toward universal fraud resilience, rather than isolated or ad hoc defences.
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Challenges and the Road Ahead
Effective deployment hinges on seamless API integration, rapid data-sharing, and continuous model tuning. RBI and DoT promise ongoing support, with FRI expected to become a sector-wide standard as adoption spreads. Financial experts urge banks to complement FRI with robust internal controls, staff training, and consumer education, especially given India’s vast remittance ecosystem and rising phishing trends.
About the Author – Anirudh Mittal is a B.Sc. LL.B. (Hons.) student at National Forensic Sciences University, Gandhinagar, with a keen interest in corporate law and tech-driven legal change