The country's major private banks and telecom companies are now preparing to eliminate one-time passwords (OTPs). Instead, they are working together on a "silent authentication" mechanism. This is a kind of  background check that will ensure that the mobile number associated with your bank app and SIM card in phone are the same.

If any discrepancies are detected during this check, the transaction will be immediately marked as suspicious or blocked. The customer doesn't need to take any action. This technology will also work on e-SIMs. This extra layer of security is designed to eliminate fraud through SIM cloning and fraudulent e-SIM swapping. Fraudsters often steal OTPs through these methods.

New security method
Silent Authentication: Banks will now check whether the SIM registered in your phone is active or not.

Prevent SIM cloning: The new technology will prevent SIM cloning and fraud using e-SIM.

You will receive alerts on your mobile network.

Sameer Shetty, group executive (digital business) at Axis Bank, told the Economic Times that they are conducting several trials with telecom companies for "silent authentication," which doesn't require any action from the customer. If someone logs into the app but the mobile number doesn't match the registered number, the mobile network will alert them. This allows us to detect potential fraud without any hassle to the customer.

What are the benefits for customers?

The biggest advantage is that you don't have to wait for an OTP or worry about it being stolen through phishing. People often accidentally give their OTP to fraudsters, resulting in significant losses. Silent authentication requires no human intervention, reducing the likelihood of fraud to almost zero. The entire process is completely silent, meaning the customer doesn't need to type any messages or enter any codes.

Planning is underway…
Telecom companies are now considering sending OTPs through their apps instead of SMS. This is because OTPs sent via SMS are easier to hack. This is in response to the Reserve Bank of India's mandate to make two-factor security mandatory for all digital transactions from April 1st.

PC: Navarastra