New UPI Scam Exposed: How to Protect Your Account from Collect Request Fraud

In the ever-evolving landscape of digital transactions, Unified Payment Interface (UPI) has revolutionized the way we handle payments, making it swift and convenient. However, with this convenience comes an increasing risk of fraud. A disturbing trend has surfaced where fraudsters exploit the UPI system by spamming users with numerous collect money requests. This fraudulent activity preys on the users’ potential carelessness, where just one mistaken approval can drain their bank account.

How the Scam Operates

The scam is simple yet effective. Fraudsters who manage to obtain your UPI ID can bombard you with multiple collect money or autopay requests. These requests often appear genuine, especially when disguised under names of trusted services like Netflix, Google Pay, or Paytm. The danger lies in the inability to distinguish between a legitimate request and a fraudulent one. For instance, you might receive what seems to be an autopay request from Netflix. If you are caught off guard and approve this request, thinking it is related to your account, you could end up paying a fraudster instead.

A UPI user recently shared her experience, revealing how she has been receiving such fraudulent requests over the past few weeks. Despite not having a Netflix subscription or a Google Pay account, she has been inundated with requests on her Paytm account. This example highlights the growing sophistication of these scams.

The Risks Involved

UPI IDs are essentially extensions of your phone numbers, making them easily replicable and prone to manipulation. This opens up a pathway for spammers to create fake UPI IDs, flooding your account with payment requests. According to Sheetal R. Bhardwaj, an executive member of ACFCS MENA chapter, the simplicity with which these IDs can be generated or duplicated makes it easier for fraudsters to carry out these scams.

Tips to Prevent Falling Victim

Preventing this type of fraud involves a combination of awareness and precaution. Senior citizens, often targeted due to their unfamiliarity with digital systems, should take extra care. Experts advise against linking high-value bank accounts directly to UPI IDs. Instead, using a wallet with a limited balance can mitigate the risk. Additionally, it is crucial to double-check the authenticity of every UPI request, especially those that appear unfamiliar or unsolicited.

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EY India suggests that UPI service providers themselves have taken some measures to enhance customer awareness. In certain scenarios, such as high-value transactions outside the normal pattern, customers are warned before entering their UPI PIN. However, much of the responsibility still falls on users to stay vigilant.

Expert Recommendations

Shobhit Goyal, Founder & CEO of BeFiSc, emphasizes that the National Payments Corporation of India (NPCI) should mandate additional layers of security for sending autopay requests through UPI. He suggests that UPI IDs should avoid using mobile numbers and instead incorporate name initials to prevent the auto-generation of fake IDs. Moreover, NPCI should explore technical solutions to disable autopay requests permanently, providing users with more control over their transactions.

As digital payments become an integral part of daily life, it is imperative for users to stay informed and cautious. While the convenience of UPI is undeniable, awareness and preventive measures are key to safeguarding your finances against fraud. Always verify every request, and if in doubt, decline or seek assistance before proceeding with any transaction.

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