India’s central bank has announced it is considering slowing parts of its instant payments network by an hour as regulators look to combat fraud.
The Reserve Bank of India has proposed a potential one-hour delay on certain digital payments, aiming to curb rising fraud in the ecosystem.
In a newly released paper titled “Exploring safeguards in digital payments to curb frauds,” the RBI outlines possible measures to strengthen user protection. Among the key proposals is a mandatory “lagged credit” mechanism for authorised push payment (APP) transactions above ₹10,000 ($107.76), which would introduce a one-hour delay before funds are fully transferred
The delay would keep payments reversible for an hour, allowing users to cancel anything they suspect as fraud. UK challenger banks, including Monzo, have recently made a similar feature available to users in the UK and Europe.
The RBI is also exploring additional safeguards such as improved authentication for vulnerable users, tighter controls on incoming credits and expanded customer-led payment restrictions, including “kill-switch” functionality.
The paper has been issued for public consultation, with stakeholders invited to submit feedback by 8 May.
Rising fraud cause push for payment friction
The RBI’s intervention is a consequence of India’s digital payments ecosystem continuing to expand rapidly, resulting in an increase in fraud cases.
According to the central bank, over the past decade, digital payments volumes have grown 38-fold supported by infrastructure such as UPI, IMPS, NEFT and card networks. However, the central bank notes fraud has increasingly moved from system breaches towards “authorised push payment” scams, where users are manipulated into initiating transfers themselves.
According to data mentioned in the discussion paper, fraud cases reported on the National Cyber Crime Reporting Portal rose from 2.6 lakh in 2021 to 28 lakh in 2025, while the value of fraud surged from ₹551 crore to nearly ₹22,931 crore over the same period.
The RBI said fraudsters are increasingly relying on social engineering tactics, including impersonation scams, bogus call centres and mule account networks. The bank added that senior citizens and other vulnerable users are disproportionately affected.
Given real-time payment systems such as UPI and IMPS allow near-instant settlement, the regulator argues there is limited opportunity to intercept or reverse fraudulent transfers once initiated.
A look at RBI’s proposals
In addition to the proposed one-hour delay, the RBI paper features a range of potential safeguards aimed at strengthening user protection.
One proposal includes additional authentication requirements for high-value transactions initiated by vulnerable users such as elderly customers or persons with disabilities, potentially requiring confirmation from a trusted third party.
Regulators are also considering rules to block big inflows into some accounts until users show additional evidence that the money is genuine, which is aimed at reducing the use of mule accounts.
The RBI is also exploring enhanced customer controls, including account-level switches to enable or disable digital payments, as well as a “kill switch” which would allow users to instantly block all digital transaction channels.
Do faster payments equal more fraud?
India is not alone in wrestling with rising fraud, with markets such as the UK also seeing significant growth in authorised push payment (APP) scams.
The UK has introduced mandatory reimbursement rules, requiring banks and payment firms to compensate victims of APP fraud, with costs split 50:50 between the sending and receiving institutions.
However, industry voices have continued to push regulators to extend liability to social media and technology platforms, arguing many scams originate through online channels.
Additionally, the increasing speed of transactions is causing more challenges. As real-time payments become the norm, both consumers and businesses expect funds to settle immediately, leaving little time to detect and prevent fraudulent activity.
Notably, the RBI’s proposals are focusing on intervention before a payment is completed, and not relying solely on controls during the narrow window after initiation but before settlement.
