Businesstoday.In RBI's New Fraud Compensation Framework Requires Timely Reporting to Avoid Loss
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- •Victims must report fraud within five days to qualify for RBI compensation.
- •The new framework begins on January 1, 2027, covering various digital fraud types.
- •Compensation is capped at ₹25,000 or 85% of the net loss, whichever is lower.
The Reserve Bank of India (RBI) is set to implement a new compensation framework for victims of digital banking fraud starting January 1, 2027. Chartered accountant Kanan Bahl warns that victims must report fraud within five days to qualify for compensation. The framework covers various fraud types, including phishing and UPI fraud, with compensation capped at ₹25,000 or 85% of the net loss, whichever is lower. Victims must notify both their bank and the National Cyber Crime Helpline within the reporting window. The burden of proof shifts from customers to banks, making banks accountable for negligence. Compensation will be funded by the RBI and the banks involved, with the RBI covering 65% of the payout. Failure to report on time will result in ineligibility for compensation.
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