Digital financial transactions in India have increased significantly, and with it, the threat of cybercrime has also increased. Digital fraud in India has increased by 7.1%, almost double the global average. Financial fraud accounts for more than 60% of all reported cybercrime complaints; with identity theft and fake “re-KYC” alerts emerging as the biggest threats.

Why KYC is important and how fraud happens
Know Your Customer (KYC) is a process where  banks and fintech platforms verify identity using official documents (such as a PAN card or government ID card). Digital KYC includes document verification via live photos and video calls for instant onboarding.

Identity theft: Scammers steal confidential information or create fake identities to fraudulently complete KYC; thereby opening new accounts, taking out loans, or issuing  credit cards in your name.

Account Suspension Scam: Fraudsters create fear among people by sending SMS alerts claiming that if you do not update your KYC immediately, your account or digital wallet will be permanently blocked within a few hours.

5 Common Types of Fraud

1. KYC Payment: Fraudsters give advance money to people to complete KYC verification on their accounts and then take complete control of those accounts and carry out illegal transactions.

2. Phishing through fake Re-KYC links: Fraudsters send instant identity verification messages and force users to submit confidential official documents and OTP under the pretext of updating KYC, which is then used to hack the account.

3. Fake loan process and fake onboarding: Scammers lure people with the promise of loan approval and force them to complete digital video-KYC on an account controlled by the fraudsters; this places all the responsibility on the individual, while the scammer retains complete control of the account.

4. SMS alerts and phishing KYC portals: Users are sent SMS threatening that their account or wallet will be permanently closed if they do not click on an external link to complete “required re-KYC”, which directly leads to the theft of people's identity and personal data.

5. Remote access misuse: Callers posing as bank officials ask people to download screen-sharing apps to “complete pending KYC verification,” giving fraudsters remote access to the device and allowing them to approve illegal transactions.

How PhonePe protects you
PhonePe has built-in security features like 'PhonePe Device Guard', which detects screen-mirroring in progress, automatically hides sensitive data and pauses the session. Additionally, security engines like 'PhonePe Protect' detect device changes and suspicious location jumps, and block unknown login attempts in real-time.

Danger signs and safety rules

Beware of panicked or intimidating messages: Be wary of unexpected calls, emails, or messages that threaten to immediately close your account. Keep confidential information safe: Never share your OTP, UPI PIN, or password with anyone over the phone or messaging apps.
Use only in-app channels: Genuine and authorized financial institutions only perform KYC updates within their official apps, never via external SMS links.

Reject screen-sharing apps: Customer support never asks you to install unknown remote desktop or screen-sharing software.
Confirm support numbers: Contact customer service only through the authorized number provided in the official app.

How to report suspicious activity

PhonePe Support: Call 080-68727374 or 022-68727374 to report such incidents.
Contact the official Twitter (@PhonePeSupport) or Facebook handle, or report an open ticket at grievance.phonepe.com.
National Cyber ​​Crime Cell: Immediately dial 1930 or file a complaint at cybercrime.gov.in.
DoT Sanchar Saathi: Report fraudulent calls or messages through the Chakshu portal at sancharsaathi.gov.in.