RBI Announces Compensation Up to ₹25,000 for Victims of Small-Scale Digital Frauds

The Reserve Bank of India (RBI) has announced that customers who fall victim to minor digital payment frauds can now receive compensation of up to ₹25,000, aiming to provide quick relief to users affected by such incidents.

Mumbai| February 07, 2026: With digital transactions becoming increasingly popular across India, incidents of fraud and unauthorized transactions have also seen a rise. In response, the RBI has designed a compensation framework intended to help consumers recover from losses caused by small-scale scams. Governor Malhotra described the initiative as a “one-time assistance” meant to offer immediate support to those impacted, even if the amounts involved are modest.

Under the proposed scheme, victims will be reimbursed for up to 85% of their lost funds, with the maximum payout capped at ₹25,000. The compensation will be granted irrespective of whether the loss occurred due to the customer’s inadvertent mistake or any error on the part of another party. Malhotra assured that the process would be simple, with no questions asked before providing the relief to eligible customers.

“This framework is designed to give some immediate relief to users who have been affected by digital frauds,” Malhotra said. “Even small amounts can cause distress, and we want to ensure that consumers are supported promptly.”

The RBI’s announcement reflects a broader effort to strengthen consumer protection mechanisms amid the rapid adoption of digital payments in India. The central bank has also highlighted the importance of awareness and preventive measures, while ensuring that regulatory safeguards exist to address potential risks.

Officials noted that while this scheme is targeted at small-scale losses, it demonstrates the RBI’s commitment to maintaining trust in the digital payments ecosystem, where consumers can transact with confidence knowing that there is a safety net in place in case of fraud.

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