Learn about the Financial Fraud Risk Indicator (FRI) and how it’s revolutionizing fraud detection in Indian banking.
What is the Financial Fraud Risk Indicator (FRI)?
- Definition: FRI is a digital tool developed by the Department of Telecommunications (DoT) to identify mobile numbers associated with fraud.
- Function: It categorizes mobile numbers into risk groups like medium, high, or very high based on their likelihood of being involved in scams.
- Data Sources: FRI gathers information from various platforms including the Cyber Crime Reporting Portal, Chakshu platform, and bank reports.
How Banks Will Use FRI
- Implementation: Scheduled Commercial Banks, Small Finance Banks, Payment Banks, and Co-operative Banks are mandated to integrate FRI into their systems.
- Actions: Banks can halt transactions, issue warnings to customers, or implement other security measures upon detecting a risky mobile number.
- Early Adopters: Leading banks like HDFC Bank, ICICI Bank, and popular apps such as PhonePe and Paytm have already embraced FRI with positive outcomes.
Real-Time Protection Using API
- Mobile Number Revocation List (MNRL): DoT’s Digital Intelligence Unit maintains a list of disconnected mobile numbers due to fraudulent activities.
- API Integration: Banks can link to DoT’s Digital Intelligence Platform through API for instant data updates, ensuring swift responses and enhanced security.
A Big Step for Safer Digital Banking
- National Initiative: The Ministry of Communications emphasizes the collective effort to combat online fraud through FRI implementation.
- Standardization: With increasing adoption by banks, FRI is poised to become a fundamental safety tool in India’s banking ecosystem.
- Benefit: FRI safeguards customers’ funds, fostering trust and confidence in digital banking services.
Key Takeaways for Competitive Exams
- Understanding of Financial Fraud Risk Indicator (FRI) and its role in fraud prevention in banking.
- Importance of real-time fraud detection systems like FRI for ensuring customer security.
- Significance of collaborative efforts in the banking sector to combat online financial frauds.
