Since the pandemic, financial fraud has steadily increased, putting the safety of native digital and nascent digital users at risk. The past year has been marked by incidences of cyber fraud, ATM fraud, debit / credit card fraud, predatory loan application fraud, insurance fraud, etc. adoption or rather addictions to digital payments, the industry seeks to grow further unless we take precautionary measures on our digital interaction journeys.
Financial frauds have always existed!
Frauds and scams have been around since humans have owned assets worth stealing, but the digital revolution in financial services has led to the industrialization of financial fraud. As huge volumes of consumers flock to online channels, frauds have become more evolved. Therefore, it is increasingly important for us to be extremely careful in our financial transactions. Most of us may not even be aware of spyware installed on our computers and can track our keystrokes or read our messages. There are now several phishing scams that use links in emails to direct customers to bogus / similar websites of banks and other financial institutions. Some involve ‘social engineering’, in which fraudsters posing as company officials call victims looking for their personal details such as PAN / Aadhar numbers, debit card PIN and credit, CVV, OTP, etc., all for the purpose of updating their e -KYC or increasing their credit limit. Text messages claiming that your EMI card has been suspended and requires e-KYC redesign is a classic example.
Warning signs of loan scams
Limited Time Offer: Personal loan scams involve bogus promises and offers that seem too tempting. If you come across a great offer, reduced interest rates, or other perks that are only available for a limited period and the lender is urging you to apply within a specific time frame, be careful! This is a technique commonly used in personal loan scams in India.
No Credit Score Checks: Every genuine and established lending institution will always check your tax returns, credit score, credit history, and previous loan payments before sanctioning your loan process.
Direct contact by lender: When the lender contacts you directly and tries to imply that you are receiving special attention and care as a customer, you should not get carried away. You only get a call after you’ve applied for a loan and the lender pre-screens before taking your application. An unsolicited call would primarily be a personal loan scammer that you should watch out for.
While financial fraud is mostly associated with urban areas, rural and semi-urban India is taking the lead in insurance fraud, mainly because insurers lack the proper infrastructure to perform due diligence. .
Fraud associated with accident compensation claims is a significant problem for general insurers. In many cases, those who died of natural causes have been classified as victims of traffic accidents, causing huge losses to insurers. Although there are various fraud networks working on planning / inventing losses for the settlement of a claim, it is often the case that frauds are not committed intentionally, but still affect both policyholders and policyholders. insurance companies. For example, citing inflated claims or including old damage as part of new claims, shops / garages overestimating damage from an accident to make money from unnecessary repairs or opting for part replacement instead of simple repairs are some of the cases.
The health insurance industry is also facing huge losses due to the increase in fraud claims, such as missing details of a pre-existing condition or mistakenly entering an incorrect date of birth when filling out the form. proposal, manipulating the results of the pre-political health check are some of the instances seen.
Remember that financial fraud can only happen when you offer an opportunity to scammers. So, next time, think twice before sharing sensitive data with someone via online, social media, or any app installed on your phone, because what you share is always “shared” in the digital world!
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