Lucrative Diwali discount could be a scam? 5 ways fraudsters can cheat you | Personal Finance
Fake discounts, phishing links and fraudulent UPI payment requests can put shoppers’ money at risk during the festival season. Here is how to protect your bank account and what cyber insurance can cover.
Attractive festive discounts and cashback offers can come at a financial cost if shoppers fail to verify where they are spending their money. With online shopping and digital payments increasing during Dhanteras and Diwali, fraudsters are using fake websites, phishing links and fraudulent UPI, short for Unified Payments Interface, requests to target consumers.
The National Payments Corporation of India (NPCI), which operates UPI, has highlighted several precautions that consumers should follow to avoid digital payment fraud during the festive season. These include shopping only through verified platforms, avoiding external payment links and never sharing one-time passwords (OTPs).
Ankit Gupta, chief technology officer at Policybazaar for Business, said festive shopping creates more opportunities for cybercriminals to exploit consumers through fake discounts, phishing links, fraudulent websites and UPI scams.
“Consumers should be cautious of deals that appear too good to be true, verify website authenticity before making payments, avoid suspicious links and never share OTPs or banking credentials,” he said.
Here are five precautions consumers should follow.
1. Shop only through official websites and apps
Fraudsters often create websites that look similar to popular shopping platforms. These websites may use familiar logos, product photographs and discount offers to convince consumers that they are shopping on a genuine platform.
However, entering card details, banking credentials or personal information on such websites can expose consumers to financial fraud.
Consumers should access shopping platforms through their official applications or by manually entering their website addresses. They should avoid clicking on promotional links received through unknown messages, emails or social media accounts.
2. Avoid payments outside shopping platforms
Some fraudsters persuade buyers to complete payments through external UPI IDs, QR codes or payment links instead of using the payment gateway provided by the shopping platform.
Such transactions can take consumers outside the platform’s usual payment and dispute-resolution process.
Consumers should complete purchases through the official checkout facility. They should also verify the recipient’s name before approving a UPI transaction.
3. Be careful with cashback and free voucher offers
Festive promotions offering free vouchers, cashback and gifts can be used to trick consumers into sharing sensitive financial information.
Fraudsters may send messages claiming that a consumer has won a reward and needs to pay a small processing fee or share banking details to claim it.
Consumers should verify such offers directly through the official application or website. They should remember that receiving money through UPI does not require entering a UPI PIN. A PIN is required to authorise payments, not to receive them.
4. Never share OTPs or banking credentials
Messages claiming that a payment has failed, a bank account has been blocked or a reward is pending may be attempts to obtain OTPs.
Consumers should never share OTPs, passwords, card details or UPI PINs with anyone over calls or messages. An OTP should be entered only when the consumer has initiated and verified the transaction.
5. Do not make payments under pressure
Fraudsters frequently create urgency by claiming that a discount will expire immediately or that an account will be blocked unless the consumer takes immediate action.
Such pressure tactics are intended to prevent consumers from checking the authenticity of a transaction.
Consumers should pause and independently verify the communication before transferring money or sharing personal information.
Can cyber insurance protect consumers against online fraud?
Even careful consumers can fall victim to digital fraud. Cyber insurance can provide an additional layer of financial protection against certain online risks.
Gupta said individual cyber insurance policies may cover online financial fraud, phishing, identity theft, cyber extortion and unauthorised digital transactions, depending on the policy. Some plans also cover legal expenses and provide assistance with identity restoration after a cyber incident.
Basic cyber insurance covers start at a few hundred rupees, making them accessible to a wider range of consumers, including families, he said.
However, consumers should not assume that every digital fraud incident will qualify for reimbursement. Coverage depends on the policy’s terms, exclusions and claim conditions.
Before purchasing a policy, consumers should check which types of fraud are covered, the maximum compensation available, exclusions and the deadline for reporting an incident.
Cyber insurance should be treated as a financial safety net rather than a substitute for safe digital payment practices.
