New Delhi, Mar 25 (BNP): The Reserve Bank of India (RBI) has proposed revised guidelines to strengthen safeguards against unauthorised electronic banking transactions, including a compensation mechanism for small-value frauds and enhanced use of artificial intelligence in fraud detection.
The draft instructions, released for public consultation on March 6, 2026, aim to update the existing 2017 framework in view of rapid technological adoption in banking and digital payments.
As part of efforts to curb cyber fraud, the RBI has rolled out “MuleHunter.AI”, an artificial intelligence and machine learning-based system to detect mule accounts used for illicit fund transfers. The system is currently operational in 26 banks and is being expanded further.
The central bank has also advised banks to deploy robust real-time transaction monitoring systems, adopt AI and machine learning tools to detect suspicious patterns, and use network analytics to identify mule account networks.
In a related development, the Indian Digital Payment Intelligence Corporation (IDPIC) has been set up as a Section 8 company to detect and prevent fraud in the digital payments ecosystem using advanced technologies such as AI, machine learning, and big data analytics.
Officials said the government is working closely with the RBI and other regulators to strengthen systems and controls to prevent cyber-enabled financial frauds.
The RBI has also undertaken multiple initiatives to improve financial literacy and cybersecurity awareness. These include the Centre for Financial Literacy project, under which over 2,400 centres have been set up, and nationwide campaigns such as “RBI Kehta Hai” to promote safe banking practices.
Market regulator SEBI is also running awareness initiatives, including the “SEBI vs SCAM” campaign and the Saa₹thi mobile app, to educate investors and prevent fraud.
The information was provided by Minister of State for Finance Pankaj Chaudhary in a written reply in the Rajya Sabha.
