RBI initiated the Central Payments Fraud Information Registry (CPFIR) in March 2020 to report payment frauds of scheduled commercial banks and non-bank Prepaid Payment Instrument (PPI) issuers.
The Reserve Bank of India (RBI) will shift its advanced supervising monetary system to DAKSH from January 1, 2023, as part of efforts to streamline reporting, enhance efficiency, and automate the fraud management process, the central bank said in a notification.
RBI initiated the Central Payments Fraud Information Registry (CPFIR) in March 2020 to report payment frauds of scheduled commercial banks and non-bank Prepaid Payment Instrument (PPI) issuers.
An efficient fraud reporting process comes with several benefits. It can provide valuable information regarding the source of payment fraud, fraud rates for different payment types, and other vital statistics. If most PSOs are a part of the fraud reporting process, the cumulative statistics will form a representative sample. These statistics would provide valuable input to the RBI to coordinate and enhance security efforts and help promote consumer confidence in payments.
DAKSH is a web-based end-to-end workflow application through which RBI will monitor compliance requirements in a more focused manner to further improve the compliance culture in supervised entities like banks, non-banking financial companies (NBFCs), etc.
“To streamline reporting, enhance efficiency and automate the payments fraud management process, the fraud reporting module is being migrated to DAKSH – Reserve Bank’s Advanced Supervisory Monitoring System. The migration will be effective from January 01, 2023, i.e., entities shall commence reporting of payment frauds in DAKSH from this date,” the RBI said in a circular.
In addition to the existing bulk upload facility to report payment frauds, DAKSH provides additional functionalities, like a maker-checker facility, online screen-based reporting, an option for requesting additional information, the facility to issue alerts/ advisories, generation of dashboards and reports. The circular added that all RBI-authorised Payment System Operators (PSOs) and payment system participants in India must report all payment frauds, including attempted incidents, irrespective of value, reported by the entities or by their customers.
“The responsibility to submit the reported payment fraud transactions shall be of the issuer bank / PPI issuer/credit card issuing NBFCs , whose issued payment instrument has been used in the fraud. Entities must validate the payment fraud information reported by the customer in their systems to ensure authenticity and completeness before reporting the same to RBI on an individual transaction basis. Entities are required to report payment frauds (domestic and international) to CPFIR as per the specified timelines (currently within seven calendar days from the date of reporting by customer/date of detection by the entity),” the Central Bank circular said.
Entities may continue to report payment frauds as per the extant reporting format using the bulk upload facility in DAKSH or report individual payment frauds online using the screen-based facility under the incident module of the DAKSH platform, according to the circular.
After payment fraud reporting goes live in DAKSH, effective, January 1, 2023, entities cannot report any fraud in EDSP. However, entities may continue updating and closing payment frauds reported in EDSP until December 31, 2022. RBI said it would subsequently migrate the historical data from EDSP to DAKSH.