The Financial Side of Cyber Scam in India Nearly INR 1,750 crore was lost to cyber fraud between January and April 2024, with 85% of these cases related to financial crime

In a matter of 10 days Indian telecommunications giant Bharti Airtel launched India's first AI powered real-time 'fraud-detection' tool and identified 51 million potential spam calls and 1.6 million malicious SMS messages in Rajasthan.

Marut Dilawari, CEO of Bharti Airtel in Rajasthan shared in the media, "The threat of scams, fraud, and malicious communications has become a growing concern for customers. In view of this, Airtel has introduced an AI-powered solution which equips all Airtel customers in Rajasthan with a powerful shield against the schemes of cybercriminals and scammers."

As the world becomes more technologically advanced, so do the cybersecurity threats and malicious softwares.

How would you react if you received a call from someone claiming to be from your company's HR department, asking for your bank details to deposit your salary? Or what if someone claimed to be a friend of your father, even mentioning your father's name to gain your trust? They will send a fraudulent SMS claiming you received extra money and ask you to return the difference via a QR code. This results in a debit from your account.

Nearly 800 digital payment fraud cases are reported in India every day, according to the Reserve Bank of India (RBI) in response to an RTI query. The common methods of cyber fraud include calls, SMS, and emails.

The Five Cyber Fraud Hubs

According to the Citizen Financial Cyber Fraud Reporting Management System, over 1.1 million complaints were reported in 2023, amounting to a staggering INR 7,488 crore in fraud. Larger states like Uttar Pradesh (197,547 complaints, INR 721.07 crore reported), Maharashtra (125,153 complaints, INR 990.69 crore reported), Gujarat (121,701 complaints, INR 650.53 crore reported), Telangana (71,426 complaints, INR 759.06 crore reported), and Rajasthan (77,769 complaints, INR 353.92 crore reported) recorded the highest number of cases, reflecting the scale of cybercrime in densely populated regions.

While states like Telangana and Maharashtra were able to block a substantial amount of funds through their proactive response—INR 131.37 crore and INR 103.08 crore, respectively—other states such as Bihar and Rajasthan struggled to recover most of the reported fraud amounts, revealing gaps in fraud prevention efforts. In Bihar, 42,029 complaints were reported with a fraud amount of INR 243.27 crore, but only INR 27.79 crore was held in lien. Similarly, in Rajasthan, 77,769 complaints were reported with a fraud amount of INR 353.92 crore, but only INR 39.35 crore was put on hold. These states need to strengthen their mechanisms for fraud prevention and fund recovery. Nevertheless, Bihar has been reported as the hub for the cyber scams.

In 2024, the cyber scam rate is increasing significantly. According to the Indian Cyber Crime Coordination Centre (I4C), nearly INR 1,750 crore was lost to cyber fraud between January and April 2024, with 85 per cent of these cases related to financial crime. Additionally, Indians also lost over INR 120 crore in investment scams during the same period, across a total of 4,599 cases.

Government Crackdown on Fraudulent Activities

Through the 'Citizen Financial Cyber Fraud Reporting and Management System,' over 4.7 lakh complaints have been addressed, leading to the recovery of more than INR 1,200 crores from financial fraud. This initiative is supported by a toll-free helpline (1930) that facilitates online cyber fraud reporting. State and Union Territory law enforcement agencies are responsible for follow-up actions on the complaints lodged. As of February 2024, more than 3.2 lakh SIM cards and 49,000 IMEIs have been blocked.

In addition, to combat spoof international calls, the Department of Telecommunications (DoT) disconnected a total of 1.77 crore mobile connections obtained using fake documents, targeting 33.48 lakh connections and 49,930 mobile handsets in high-risk cybercrime districts. Furthermore, 2.29 lakh mobile phones involved in fraudulent activities have been blocked, and 11 lakh financial accounts and WhatsApp profiles linked to fraudulent mobile connections have been frozen or deactivated. The crackdown also includes the blacklisting of 71,000 SIM agents and the registration of 365 FIRs as of October 2024.

In 2023, Bharti Airtel in partnership with HDFC Bank developed and tested an artificial intelligence (AI)/machine learning-based solution to combat phishing, spam, and fraud through messaging. While Airtel takes scam and fraud detection diligently, others are not far behind.

In 2022, rival Vodafone's Germany vertical partnered with RealNetworks to test an anti-fraud voice call solution using KONTXT. Additionally, Vodafone Carrier Services, the wholesale arm of Vodafone Business, introduced a new service called Scam Signal which will enable businesses to safeguard their customers against impersonation scams, particularly those related to Authorised Push Payment (APP) fraud.