RBI to migrate payments fraud reporting by banks and non-bank PPI issuers to Daksh on Jan 1, 2023

The Reserve Bank of India (RBI) announced on Monday that the payments fraud reporting module will be migrated to Daksh, the RBI’s advanced supervisory management system, on January 1, 2023, in order to streamline reporting, improve efficiency, and automate the payments fraud management process via issuing Notification.

The Notification Stated, “As announced in the Monetary Policy Statement 2019-20 on August 07, 2019, the Reserve Bank of India (RBI) had operationalised the Central Payments Fraud Information Registry (CPFIR) in March 2020 with reporting of payment frauds by scheduled commercial banks and non-bank Prepaid Payment Instrument (PPI) issuers.”

The fraud reporting module is being migrated to DAKSH – the Reserve Bank’s Advanced Supervisory Monitoring System – in order to streamline reporting, improve efficiency, and automate the payments fraud management process. The migration will take effect on January 1, 2023, and entities must begin reporting payment fraud in DAKSH on that date. In addition to the existing bulk upload facility for reporting payment frauds, DAKSH offers additional functionalities such as a maker-checker, online screen-based reporting, the option to request additional information, the ability to issue alerts / advisories, the generation of dashboards and reports, and so on.

The RBI has issued a circular requiring all authorised Payment System Operators (PSOs) and payment system participants in India to report all payment frauds, including attempted incidents, regardless of value, whether reported by their customers or detected by the entities themselves. This reporting was previously handled by the Electronic Data Submission Portal (EDSP), but it is now handled by Daksh.

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 are required to validate the payment fraud information reported by the customer in their own systems to ensure the authenticity and completeness, before reporting the same to RBI on individual transaction basis.

Entities are required to report payment frauds (domestic and international) to CPFIR as per the specified timelines (currently within 7 calendar days from date of reporting by customer / date of detection by the entity).

The RBI launched the CPFIR in March 2020, with payment fraud reported by scheduled commercial banks and non-bank PPI issuers.

“After payment fraud reporting on Daksh goes live on January 1, 2023, entities would not be able to report any payment frauds in EDSP. However, entities may continue to update and close payment frauds reported in EDSP until December 31, 2022. The Reserve Bank will then migrate historical data from EDSP to Daksh,” the RBI stated.