• Download the discussion paper here.

The Reserve Bank of India (RBI) has released a discussion paper proposing additional safeguards to curb digital payment fraud, citing rising Authorised Push Payment (APP) fraud risks and limited recovery options. Public comments are open until May 8, 2026.

What the RBI is proposing: An added authentication layer for vulnerable users in high-value digital payments. It says banks should require a “trusted person” to approve certain transactions.

Key operational features:

• Mandatory for citizens aged 70+ and persons with disabilities; optional for others.
• Applies to APP transfers; excludes merchant, recurring, and cheque payments.
• Threshold set at Rs 50,000 and above.
• Requires a trusted person to act as an additional authenticator.
• Imposes a 24-hour cooling-off period for changing a trusted person and for opting out, with re-enrolment allowed.

Benefits and concerns flagged:

• Adds an independent verification layer that is less susceptible to coercion and impersonation tactics.
• Helps protect accounts with larger balances where potential fraud losses are higher.
• Raises legal and operational concerns, as existing banking practice recognises only account holders or authorised signatories, while the trusted person would influence transaction execution without any legal or beneficial interest in the account
• May delay transaction execution if the trusted person is not immediately available to authenticate.

Global precedents:

• Sweden: Banks may require customers to obtain approval from a trusted individual for certain transactions as part of anti-fraud measures.
• United States: Banks offer trusted contact facilities, where designated individuals can be contacted, and they may also access accounts under a power of attorney.
• Ireland: Customers can nominate a trusted contact who provides support in suspected fraud cases without decision-making authority.

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