A State Bank of India (SBI) customer who attempted to pay a Rs 20 electricity bill ended up losing Rs 1.99 lakh in a cyber fraud. The National Consumer Disputes Redressal Commission (NCDRC) has now directed the bank to refund the money and additionally pay Rs 25,000 as compensation, The Indian Express reported on Friday.
How The Fraud Happened
As per the report, the case dates back to July 19, 2022, when Bengaluru resident Prodosh Kumar Banerjee received a fraudulent SMS warning that his electricity would be disconnected for non-payment. When he called the number in the message, he was asked to download a mobile application that looked like the official electricity department interface.
He then tried to pay Rs 20, but his SBI account was hit by two unauthorised debits: first Rs 25,000, and then Rs 1.99 lakh. The report said no OTP was shared and his phone later became non-functional.
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What The Customer Did And Said
Banerjee immediately approached cybercrime police, which led to a complaint and FIR being registered. He also informed SBI through its helpline and email on the same day. The bank later re-credited the Rs 25,000 and froze the account, but it did not succeed in reversing the larger Rs 1.99 lakh debit.
The matter then reached, NCDRC. The bench of Presiding Member AVM J Rajendra (Retd) and Member Justice Anoop Kumar Mendiratta was hearing SBI's second appeal against a Karnataka State Consumer Commission order dated May 26, 2025.
The commission said the bank “cannot be absolved” of liability for the loss because the fraudulent transactions were reported within the stipulated period. It also held that merely downloading a fake app does not amount to negligence by the consumer, and that SBI failed to prove any wrongdoing on the customer's part.
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Why SBI Lost The Case
SBI had argued that the fraud could not have happened without OTP sharing and claimed there was a delay in reporting. The commission rejected that defence, noting the fraud was reported within hours and that the bank's own re-credit of Rs 25,000 weakened its stand. It also relied on the RBI's July 6, 2017 circular on zero liability for unauthorised electronic transactions reported within three working days.
The final order directed SBI to re-credit Rs1,99,000, pay Rs 25,000 compensation, and comply within four weeks, failing which 8% annual interest would apply.
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