UPI Frauds On The Rise In India: Types Of Scams And How To Avoid Them

Digital payments have become an integral part of daily financial transactions for many people across India, especially in urban areas. The Unified Payments Interface (UPI) has revolutionised digital payments across the country since its launch by the National Payments Corporation of India (NPCI) in 2026.

It has made transactions quick and convenient both for customers and merchants. Once you have a UPI app, you don’t need to always carry your wallet if your smartphone is with you. 

However, there is also a flip side to the growing use of UPI with several falling prey to UPI scams and losing their hard-earned money.

Here are some common types of UPI scams and tips to avoid such financial frauds.

1. Refund Scams

In a refund scam, fraudsters send a small amount to your account and then contact you to request a refund. They ask you to “return” much more than what you received. To create a sense of urgency, they often claim reasons such as a medical emergency.

2. Cash-for-UPI Scams

In this case, scamsters offer to exchange cash for a UPI transfer. Once you transfer the money, they either disappear without giving you the promised cash or hand you counterfeit notes. 

3. Phishing Links

Sending fake SMSes, WhatsApp messages, or emails with malicious links is another trick in the book. Once you click the link, it leads to a fake UPI app interface that captures your credentials, PIN, or OTP. These links are called phishing links.

4. Fake UPI Apps And QR Code

Online scammers create fake UPI apps or QR codes that resemble legitimate platforms of financial service providers. Scanning the QR code or downloading a malicious app could lead to unauthorised access to your bank account. 

In several cases, people are asked to scan a QR code to receive money, while scanning it actually leads to a deduction from the account. 

5. Impersonation Scams

Scamsters impersonate trusted individuals, such as bank officials or police, requesting urgent payments via UPI. They can claim that it will help in resolving an issue or clearing pending dues.

• Never Share Your UPI PIN: Your UPI PIN is required only to send money, not to receive it. Never share it with anyone, including bank officials or customer care representatives.

• Don’t Click On Suspicious Links: You must never click on suspicious links from unverified sources. 

• Use Trusted UPI Apps: You must use reputable UPI platforms and download them from the Google Play Store or Apple App Store. Don’t download apps from third-party sources.

To conclude, it's important to understand the common types of UPI scams and take basic precautions—such as never sharing your OTP—to avoid becoming a target of scamsters. If you do become a victim, report the incident immediately to the police and your bank.