Surge in Digital Banking Fraud in India: Key Insights from BioCatch Report
A recent report by BioCatch reveals a dramatic 146% increase in text message scams in India, indicating a shift towards scam-based digital fraud. The findings highlight the growing use of UPI, mobile banking, and e-commerce as platforms for fraud, with a notable rise in the value of fraudulent transactions. The report also discusses the automation of fraud techniques and the prevalence of active phone calls in scams, emphasizing the need for enhanced security measures in the banking sector. As cybercriminals adapt their strategies, the collaboration between financial institutions and law enforcement becomes crucial in combating these threats.
Jul 24, 2026, 18:34 IST
Rising Trends in Digital Fraud
According to a report by BioCatch titled 'Digital Banking Fraud Trends in India 2026', there has been a staggering 146% increase in scams conducted via text messages. This indicates a rapid shift towards scam-based attacks within the country's digital fraud landscape. The report highlights that the rapid growth of Unified Payments Interface (UPI), mobile banking, e-commerce, and online investment platforms has made India's fraud ecosystem increasingly digital, large-scale, and scam-oriented. Although there has been a 12% decrease in attempted fraud sessions among BioCatch's clients, the total value of fraudulent payment attempts has surged by 35%. This suggests that fraudsters are now targeting transactions of higher value.
Emerging Scam Techniques
The report further states that UPI, investment scams, impersonation, and digital arrest scams are contributing to the rapidly growing 'money mule' ecosystem in India. Text message scams have emerged as one of the fastest-growing methods of fraud, as cybercriminals increasingly use SMS to lure victims into sharing sensitive information or approving fraudulent transactions. The report also sheds light on the evolving tactics of fraud, noting that risky payment sessions have doubled, while the median amount transferred in each fraudulent session has increased by 1.7 times. Additionally, the average duration of phone calls has decreased by 31%, and the median length of sessions has dropped by 32%, indicating that fraudsters are now executing attacks more swiftly and efficiently.
Automation in Fraudulent Activities
BioCatch has observed that fraud is becoming increasingly automated, with a higher usage of autofill tools for login credentials, enabling criminals to launch attacks more rapidly. While improved detection systems in banks have led to a decline in Remote Access Trojan (RAT) attacks, the rise in credential autofill usage suggests that financial institutions need to enhance their malware detection capabilities.
Active Phone Calls in Fraud Cases
The report also notes that most fraudulent cases now involve active phone calls, where fraudsters maintain contact with victims during the payment process, guiding them at every step and preventing them from seeking help or verifying transactions independently. According to BioCatch, the banking industry has responded to these challenges through improved reporting of financial crimes, AI-based fraud detection technologies, and enhanced collaboration among banks, the Reserve Bank of India (RBI), the Indian Cyber Crime Coordination Centre (I4C), and law enforcement agencies.