New Delhi: In a concerning development for digital transaction security, Google Pay has not yet integrated the government’s Fraud Risk Indicator (FRI) into its platform. The FRI, developed by the Department of Telecommunications (DoT), is designed to flag mobile numbers associated with potential financial scams, thereby helping digital payment platforms identify and block fraudulent activities. According to DoT Secretary Neeraj Mittal, this delay leaves approximately one-third of Unified Payments Interface (UPI) users in India unprotected.
The FRI system categorizes phone numbers based on their risk level, providing crucial warnings or blocking transactions for users interacting with higher-risk numbers. This proactive measure aims to curb financial fraud at its source. While competitors like PhonePe and Paytm have swiftly integrated the FRI into their services, Google Pay’s development timeline, attributed to its status as a multinational corporation, has led to a prolonged integration period.
DoT officials noted that over 50 banks and UPI players have successfully implemented the FRI in less than two months, underscoring the system’s accessibility and the urgency of its adoption. The government’s objective is to foster a secure, sovereign, and home-grown UPI ecosystem through such integrations.
The impact of this delay is significant, considering Google Pay handles a substantial share of UPI transactions, estimated between 30-35%. This means a large user base is currently missing out on an essential layer of security. PhonePe and Paytm have already reported significant successes with the FRI, with PhonePe claiming to have helped users avert potential fraud losses of around ₹125 crore and Paytm reporting savings of ₹68 crore in the past two months.
Google, in its defense, stated that it is actively discussing integration with the DoT and highlighted its own AI-based fraud prevention initiative, DigiKavach. However, statements from Google representatives have been conflicting, with one spokesperson claiming integration while others acknowledge ongoing discussions and longer development cycles.
The Reserve Bank of India (RBI) had mandated the integration of FRI for all scheduled commercial banks, small finance banks, payments banks, and cooperative banks in June, recognizing the increasing vulnerability to online fraud as internet penetration grows in India. The DoT views this directive as a pivotal moment in combating cyber-enabled financial fraud, especially as cybersecurity incidents have seen a sharp rise.
With UPI becoming the primary payment method across India, the widespread adoption of the FRI is crucial to protect millions from falling victim to increasingly sophisticated cyber fraud schemes. So far, the DoT has taken action by blocking over 942,000 SIM cards and 263,348 IMEIs linked to cyber fraud activities.