Taxonomising Digital Financial Harms for Ecosystem Resilience
India’s rapid expansion of digital payments and fintech adoption has been accompanied by a sharp rise in digital financial fraud, with losses running into tens of thousands of crores and cases proliferating due to increasingly sophisticated scams that exploit both user trust and digital infrastructure. This report presents a systematic analysis of fraud typologies, their impact on user trust, and the resulting barriers to sustained digital adoption.
Drawing on primary data from law enforcement sources, First Information Reports (FIRs) and cybercrime helpline complaints, the study examines victim experiences, scammer tactics, and gaps in detection and redressal mechanisms. It identifies critical vulnerabilities at both the user and product levels, alongside structural weaknesses such as underreporting, limited recovery pathways, fragmented stakeholder coordination, and insufficient real-time protections against social engineering and emerging threats.
The report proposes a multi-stakeholder framework to strengthen ecosystem resilience, encompassing an enhanced fraud taxonomy, targeted policy reforms, technological upgrades, and collaborative actions to rebuild trust, reduce losses, and reinforce the integrity of India’s digital payments ecosystem.
