An expert said that the cess could be used to create a fund to battle the growing number of cases of online fraud in digital payments.
New Delhi: A high-level meeting on how to curb cyber fraud in digital transactions has proposed the imposition of a token ‘security fee’ on every digital payment in India.
The suggestion from the Department of Financial Services was among many others from participants.
Nasscom Internet Council head Prasanto K. Roy said that a fee on every digital transaction could be aimed at starting a fund to create better infrastructure to secure digital transactions, like the Swachh Bharat cess.
“A special fund could help develop security infrastructure, hire experts and secure online transactions, though a cess on digital transactions isn’t the best way of doing it,” he told ThePrint. “The Ministry of Finance and the Ministry of Electronics and Information Technology (MeitY) need to encourage digital transactions by making them cheaper, not more expensive. There are other, better ways to fund digital security.”
Emails and calls to officials from the Department of Financial Services regarding the proposal received no response.
The focus of the meeting held on 13 September was to discuss measures to make digital transactions safer. The meeting, chaired by Home Minister Rajnath Singh, was attended by officers from the MeITY, Home Ministry, Department of Financial Services, Department of Telecom, Reserve Bank of India and Intelligence Bureau.
“The meeting was attended by all major stakeholders to discuss and recommend ways on how to make these transactions safer as the number of people shifting to digital payments are expected to increase by next year,” an official from the Ministry of Home Affairs said on condition of anonymity.
“It was also discussed that an Act needs to be in place for regularising digital payments, which will be looked after by the finance ministry, and to how fix the responsibilities of agencies,” the official said.
Cyber frauds targeting e-payments have been on the rise. Official figures say that cases related to e-wallets and e-payments (that were reported to banks) jumped from 13,083 cases in 2014-15 to 16,468 cases in 2015-16.
The Intelligence Bureau proposed the Indian government ensure the development of a software that detects attempts at cyber fraud. As per the suggestion, the software once developed should be incorporated by payment gateways so that customers can be alerted about suspicious transactions. .
“There needs to be a machinery to detect out-of-bound transactions and the pattern of violations in cyber fraud cases. The machinery should be able to figure if the transaction is fraudulent by looking at its pattern and send alerts,” Nasscom’s Roy said.
MEiTY recommended the creation of a literacy campaign on digital payments to educate people and keep them secure.
“Most online frauds happen as people share their passwords, ATM pins, 3D secure pins, and there is a need to educate them about it. Also, a standard procedure for all e-wallets needs to be in place as right now anyone can make a wallet just by downloading the app. The KYC norms need to be strengthened for safer transactions,” the official from the Home Ministry said.
As a first step though, the Home Ministry has recommended the creation of a dedicated cyber-forensics lab. The ministry has suggested that 27,500 police personnel, along with 13,000 forensic officers, be trained on how to tackle cyber fraud cases.
“As of now we do not have the manpower or expertise to deal with cyber fraud cases, which is going to be challenging…we need to be prepared,” the Home Ministry official said.
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