Indian banks have proposed a 'Yes-No' confirmation prompt for high-risk UPI transactions to fight a surge in digital fraud. This alternative to a mandatory payment delay aims to protect users while maintaining instant transaction speeds. The RBI is currently reviewing the proposal as fraud cases have increased significantly over the last few years.
Indian banks are seeking approval from the Reserve Bank of India (RBI) to introduce a mandatory 'Yes-No' prompt for high-risk peer-to-peer (P2P) UPI transactions. This proposal is designed to address the sharp rise in digital fraud while keeping the payment process fast for everyday users. Instead of implementing a blanket delay on all transactions above a specific amount, banks are suggesting a more focused approach that adds a layer of security only when a transaction shows signs of being unusual.
Targeted Security for Anomalous Payments
The banking industry’s proposal suggests that the system should trigger a confirmation prompt for payments that fall outside typical user behavior. These flags include transactions made at odd hours, payments to new or unknown beneficiaries, or transfers to recently opened accounts often linked to money mule networks. If a user receives this prompt and selects 'Yes', the transaction proceeds instantly. Choosing 'No' cancels it. If the user does not respond, the payment would be held for one hour before being credited to the receiver, effectively providing a cooling-off period for potentially fraudulent transfers.
Addressing the Fraud Crisis
This push for additional security comes in response to a dramatic increase in reported digital fraud. According to industry data, reported incidents climbed from 2.6 lakh cases in 2021 to 28 lakh in 2025. The total value involved in these frauds has also seen a significant rise, growing from ₹551 crore to ₹22,931 crore over the same period. A major portion of these losses stems from Authorized Push-Payment frauds, where victims are tricked into sending money themselves.
Challenges and Industry Differences
While banks argue this method is better than the RBI's earlier consideration of a mandatory wait time for all transactions above a certain limit, there is no consensus across the payment ecosystem. The National Payments Corporation of India (NPCI) has reportedly expressed concerns that adding these frictions could hurt the user-friendly nature of UPI and potentially slow down the growth of digital payments in the country. There is also technical complexity in distinguishing between genuine peer-to-peer payments and merchant payments, as many small vendors use personal QR codes linked to savings accounts, which could lead to unintended interruptions for small business owners.
Banks are also requesting that the threshold for these checks be set higher, potentially at ₹20,000 or ₹25,000, to ensure that the majority of small, routine daily payments remain unaffected. Investors and users should monitor further communications from the RBI regarding the final framework, as any new mandatory security feature will directly influence how millions of digital transactions are processed daily.