The Reserve Bank of India (RBI) has proposed new measures to strengthen digital payment security in India, including a one-hour cooling-off period for UPI and bank transfers, aimed at reducing rising fraud cases.
Under the proposal, transactions above ₹10,000 may be subject to a one-hour delay. During this cooling-off window, funds will be provisionally debited, allowing users to cancel payments if fraud is suspected. The delay could be applied at the sender’s or receiver’s end, or both, even in real-time systems like UPI and IMPS.
Why RBI Is Introducing a Cooling-Off Period
India’s digital payments ecosystem has seen explosive growth, expanding 38-fold over the past decade. However, fraud cases have surged significantly—from 2.6 lakh incidents in 2021 to 28 lakh cases involving ₹22,931 crore in 2025.
A majority of these frauds involve social engineering tactics, where scammers create urgency through fake emergencies or impersonation to trick users into authorising instant payments. Notably, transactions above ₹10,000 account for 98.5% of total fraud value, making them a key focus area for regulators.
The proposed delay acts as a risk mitigation tool, giving users time to reassess transactions and enabling banks to detect suspicious activity before funds are lost.
Additional RBI Measures to Enhance Payment Security
Alongside the cooling-off period, the RBI has suggested several new safeguards to strengthen UPI and digital banking safety:
- Kill Switch Feature: Users can instantly disable all digital payments in case of suspected fraud
- Transaction Limits: Caps on suspicious or high-risk accounts
- Enhanced Verification: Additional checks for vulnerable users
- Trusted Person Approval: Transactions above ₹50,000 may require approval from a nominated trusted individual for senior citizens and persons with disabilities
These measures aim to build proactive fraud prevention mechanisms into India’s digital payments infrastructure rather than relying solely on post-incident action.
What This Means for Users
While the proposed changes may introduce slight delays in high-value transactions, they are designed to increase user protection, trust, and control in an increasingly digital financial ecosystem. The cooling-off period, in particular, could help prevent irreversible losses caused by impulsive or manipulated transactions.
As digital payments continue to grow, the RBI’s initiative highlights the importance of balancing speed with security to safeguard users against evolving cyber threats.
