High Trust and Heavy Usage of Digital Payments Leave Many Indians Open to Cyber Fraud

Digital payments and UPI have become part of daily life across India, but high usage and deep trust are leaving users more exposed to cybercrime. UPI processed over 24,000 crore transactions in the 2025-26 financial year, with transaction values crossing ₹314 lakh crore. India now has 70% of its population connected to the internet, making the large user base a tempting target for criminals.

Behaviour and Risk

The Status of Policing in India Report 2026 shows how everyday habits connect to cyber risks. About 49% of respondents use UPI apps every day, while 24% use them once or twice a week. Nearly half of the people use UPI many times, placing it well ahead of cards, wallets, and NEFT or RTGS methods. Trust follows this heavy usage, with 34% calling UPI very safe and 41% considering it somewhat safe. However, the report reveals a striking pattern where people who are most confident about online banking safety are also the ones most prone to unsafe online practices and past cybercrime victimization. Those who use UPI many times are more likely to have faced cyber fraud in the last two to three years.

Methods and Mules

Fraudsters are using organized and inventive schemes to exploit this trust. A cybercrime expert noted that criminals buy fraud kits containing pre-activated SIM cards, bank accounts, and cell phones for ₹10,000 to ₹20,000, using them to steal lakhs or crores while staying untraceable. Victims face tactics like fake investment apps, online task scams, and digital arrest threats where callers pose as officials and force targets onto prolonged video calls. In some cases, fraudsters recruit everyday users to lend out their bank accounts, leaving these unwitting people to face police action while the masterminds go free. According to legal expert Javed Pashu Sayyed, victims and account holders also face secondary legal hurdles when tainted fraud money passes through their accounts, resulting in bank freezes and debit restrictions.

Context

India's rapid shift toward cashless transactions has transformed daily commerce from tea stalls to doctors' clinics, bringing immense convenience and financial inclusion. At the same time, this vast digital migration creates new avenues for organized criminals who rely on social engineering rather than simple technical hacks. Authorities advise calling the national cybercrime helpline at 1930 immediately to report financial fraud and freeze disputed funds before they move through multiple accounts.