22-05-2025
Govt to Block UPI Transfers to High-Risk Numbers Under New Anti-Fraud Initiative
In a significant move to curb rising cyber frauds, the Indian government has introduced a new system that will block Unified Payments Interface (UPI) transactions to mobile numbers identified as high-risk. The Financial Fraud Risk Indicator (FRI), launched by the Department of Telecommunications (DoT), aims to prevent financial crimes by flagging suspicious mobile numbers in real time.
This proactive initiative is part of a broader strategy under the Digital Intelligence Platform (DIP), designed to strengthen digital financial safety. According to the DoT, the system will assist banks, NBFCs, and UPI platforms like PhonePe, Paytm, and Google Pay, which together handle over 90% of UPI transaction volume in India.
How the FRI System Works
The FRI tool uses data from multiple sources to assess and assign a risk profile to mobile numbers. These include the National Cybercrime Reporting Portal (NCRP), the DoT's Chakshu platform, and intelligence from banks and financial bodies. Based on this information, mobile numbers are categorised into Medium, High, and Very High-risk levels.
If a user attempts to make a UPI payment to a number tagged as 'Very High Risk,' the transaction will be automatically blocked, and a warning will be displayed. In the case of 'Medium Risk' numbers, the UPI app will issue a cautionary notification, prompting the user to manually confirm the transaction before proceeding.
'The Digital Intelligence Unit (DIU) of DoT regularly shares the list of Mobile Numbers that were disconnected (Mobile Number Revocation List - MNRL) with stakeholders along with the reasons for disconnections viz. found involved in cyber-crime, failed re-verification, exceeding prescribed limits. These numbers are also usually used for financial frauds,' reads the official government blog post.
The system is designed to act swiftly, with near real-time data sharing, ensuring that suspicious numbers are flagged before any potential fraud can occur. In addition to blocking high-risk transactions, UPI platforms may introduce extra verification steps and transaction delays for numbers with a suspicious history.
Why This Matters
The FRI rollout comes at a time when cybercrime in India is escalating. Fraudsters frequently exploit newly issued SIM cards for scams, which are often deactivated soon after to avoid detection. This has made it increasingly difficult for law enforcement agencies to trace fraudulent activity in time.
To counter this tactic, the Mobile Number Revocation List (MNRL) maintained by the DIU plays a key role. This list, shared with banks and UPI platforms, contains details of mobile numbers disconnected due to fraud, failed KYC verification, or exceeding usage limits. These mobile numbers are commonly found to be at the heart of financial fraud cases.
The FRI initiative represents a crucial step in creating a safer digital payment environment in India. By leveraging shared intelligence and categorising risky behaviour, it empowers UPI service providers to act promptly and protect users from financial harm.
