The conventional literacy has gradually shifted its focus to digital and financial literacy and the pandemic helped a lot to change the habits of people. It became a game changer as people from lower and middle class started using digital modes for their financial transactions.
Lockdowns and social distancing accelerated the usage of digital financial services and ecommerce which in turn helped improve financial inclusion in the society. Founded by the Bill Gates and Melinda Gates Foundation, the Alliance for Financial Inclusion (AFI) is an international policy institute and public policy network that specialises in financial inclusion policy for the unbanked and under-banked regions of the world defined digital financial literacy as acquiring the knowledge, skills, confidence and competencies to safely use digitally delivered financial products and services, to make informed financial decisions and act in one’s best financial interest per individual’s economic and social circumstance.
A financially literate person who can well manage his finance but not able to know what is UPI, internet banking, RTGS, NEFT, digital wallet, opening on line account, etc., may not be termed as digitally literate.
At the same time, a digitally literate person may not be a financially literate person as he is not aware of the concepts like compound interest, insurance, retirement planning, etc. What is needed for an inclusive development of the society is the growth of digital financial literacy or else many of them end as the victims of cyber frauds. People should have competency of using the digital financial services along with knowledge of the risks and consumer protection. According to the Crime in India 2020 report of National Crime Report Bureau (NCRB) a total of 50,035 cases were registered under Cyber Crimes in 2020, showing an increase of 11.8% in registration over 2019 (44,735 cases).
The crime rate under this category witnessed a growth from 3.3 in 2019 to 3.7 in 2020. During 2020, 60.2% of cybercrime cases registered were for the motive of fraud (30,142 out of 50,035 cases) followed by sexual exploitation with 6.6% (3,293 cases) and extortion with 4.9% (2,440 cases).
A total of 18,657 cases have been registered in metropolitan cities under Cyber Crimes, showing an increase of 0.8% over 2019 (18,500 cases). The cybercrime rate also increased from 16.2 in 2019 to 16.4 in 2020. Crime head-wise cases revealed that Computer Related Offences (section 66 of IT Act) (11,356 cases) formed the highest number of Cyber Crimes accounting for 60.9% during 2020. The apex financial institutions of the country like RBI, IRDAI, SEBI and PFRDA are making all-round efforts to educate the citizens how to conduct safe digital transactions and protect themselves from cyber frauds.
The National Centre for Financial Education (NCFE) is also striving hard to develop a safe browsing culture and the precautions one must take while doing digital financial transactions. An attempt has been made in this article to explain various modes of cyber frauds. Through awareness, we can save ourselves from them.
Sometimes, fraudsters gain access to our mobile device or laptop or desktop once we download an unknown or unverified app or software. The links look like authentic names, but in reality we are redirected to download the unknown application. Once the malicious application is downloaded, the fraudster can gain complete access to our device and all our vital information will be stolen. Beware of the third-party websites which looks like existing genuine, popular website, such as bank’s website or e-commerce website or search engine, etc., which are created by the fraudsters. The links are normally circulated by fraudsters through SMS/ social media/ email/ Messenger, etc.; and when a customer enters secure information without checking the detailed URL, all our vital information is captured and used by the fraudsters to make us a scapegoat.
The fraudsters sometimes use online selling platforms pretending as buyers of our products. On the pretext of paying money, they send the request money option through UPI apps and pursue to approve the request to draw money from our account. We must remember that to receive money one need not give the PIN or password.
The most popular modus operandi by the fraudsters is the vishing/phising calls. They contact people at random, ask for their details of accounts posing as the Bank Officials or Government Officials threatening to lock their accounts, in case they will not submit the details immediately. Once the details like date of birth, account number, card number, pass words, OTPs, etc., are passed to them, they use this data to withdraw money from our accounts. The RBI issues messages, videos and print notifications that no bank officer ever will ask for pin or OTPs of customers.
A recent mode of cyber fraud is that a message will be received quoting income tax refund of a lump sum amount to an account and the receiver will be asked to verify the account number whether it is correct or not.
In the next sentence they instruct to give the correct account number using the given link. Normally, the number given is not ours and we will try to give the correct number through the link which will transfer all our confidential data to the fraudster.
Some technically-sound fraudsters install skimming devices in the ATM machines to steal data from our card. They may also stand nearby posing as the other customers, gain access to our PIN while we enter. Later on, they create replica cards to siphon off money from the account. SIM Swap or SIM Cloning is another way of the fraudsters to get access to our bank accounts and the necessary OTPs. By cloning, they gain access to all our credentials and use this to withdraw money. In June, Bhubaneswar police busted a racket which sold around 2 lakh pre activated sim cards to fraudsters in different states.
Unverified contact numbers displayed by the search engines like Google can also help the fraudsters to reach the prey. When one search for a customer care number, these look alike websites and their numbers attract the innocent customers to reveal their credentials and become victims of these tricksters.
The data can also be stolen by the fraudsters when we use a charging port of a mobile to an unverified or unknown port. Malware or fraudulent apps are installed without our knowledge which shares our confidential data with the fraudsters. Another common way of defrauding the customers is the creation of a fake social account. A fake id is created in the name of a popular person, friend requests are sent to others, and soon after accepting the friend request, they start their gimmicks like asking for financial help. Similarly, the lottery scam also a popular method by these cheats.
They send messages to the phone numbers informing them that they won prizes or selected for the free gifts by a popular company. To receive the money or gift, they are lured to deposit some advance in the fraudster’s bank account. The mobiles will be switched off soon after the amount is deposited.
Keeping pace with the growth of digital transactions, new modes of cyber frauds are introduced by the culprits. Financial literacy through financial education can only minimise these cyber frauds and the common man can safeguard his hard-earned money.
(Dr Biswal is Head, Department of Commerce, Nowrangpur College, Nabarangpur 764063. Mob:9437125286, bhaskarnathbiswal@gmail.com)
