Frauds—the Achilles’ heel of AePS transactions?

• by Shweta Menon, Mitali, David Mathew, Gayatri Pandey and Nikhita Jindal
• Dec 13, 2024
• 1 min
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Digital payments’ growth has increased instances of fraud, which disproportionately impacts LMI users. This note highlights some common types of AePS fraud and their impact and suggests measures to combat fraud.

AePS-related frauds account for 11% of 1.13 million cases and amount to INR 823.74 crore (USD 98 million). Anecdotal evidence suggests that some providers have reported up to 20 times more fraud than others when measured as a percentage of their total transaction volume. A sophisticated, multilayered approach that uses technology, regulation, collaboration, and education is needed to combat fraud. This note examines the types of AePS fraud, their impact, and current measures and recommends strategies to enhance the framework through prevention and awareness initiatives.