To reduce digital fraud cases, the National Payments Corporation of India (NPCI) is considering discontinuing the “Pull Transaction” feature on the Unified Payments Interface (UPI). NPCI and banks are currently in the initial stages of discussions regarding this move. A significant number of digital frauds occur through pull transactions, and NPCI is exploring the possibility of removing this feature entirely to minimize such risks.
Why Are Banks Concerned?
According to reports, discontinuing pull transactions could help reduce digital fraud cases. However, some bankers fear that this move may also impact genuine transactions and reduce UPI payment efficiency. As of now, NPCI has not provided an official response on the matter. NPCI is responsible for operating the country’s online retail transactions and settlement systems.
No Final Decision Yet
The discussion is still in its early stages, and no final decision has been made regarding its implementation. These deliberations are happening at a time when UPI transactions are at an all-time high. In February alone, UPI facilitated 16 billion transactions amounting to over ₹21 lakh crore.
Rise in Cyber Fraud
With the increasing number of digital transactions, cyber fraud cases are also on the rise. Fraudsters are using advanced techniques to scam people, leading to financial losses and increased mental stress.
What Is a Pull Transaction?
A pull transaction occurs when a merchant sends a payment request to a customer, with the transaction amount pre-filled. The customer only needs to enter their UPI PIN to authorize the payment. In contrast, a push transaction happens when the customer manually enters the amount while making a payment via QR code or other methods.
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Over 27,000 Complaints Received by RBI
In the first half of the financial year 2024-25, the Reserve Bank of India (RBI) received more than 27,000 complaints through its ombudsman. This included 14,401 complaints between April and June 2024, and 12,744 complaints between July and September 2024.
According to RBI’s Financial Stability Report released in December 2024, over 70% of these complaints were related to loans and digital payment fraud. RBI has also emphasized the importance of awareness initiatives to educate people about such fraudulent activities.