Deposit insurance cover for PPIs

GS Paper - 3 (Economy)

Prepaid Payment Instrument (PPI) holders may soon get protection for their money against any fraud or unauthorised payment transactions. A committee set up to review the Customer Service Standards in RBI Regulated Entities has recommended that the central bank should examine the extension of Deposit Insurance and Credit Guarantee Corporation (DICGC) cover to PPIs, which, at present, is available only to bank deposits. If the committee’s recommendation is accepted, it will come as a big relief for PPI holders.

What are PPIs?

1. PPIs are instruments that facilitate the purchase of goods and services, conduct of financial services and enable remittance facilities, among others, against the money stored in them.
2. PPIs can be issued as cards or wallets. There are two types of PPIs – small PPIs and full-KYC (know your customer) PPIs.
3. Further, small PPIs are categorized as – PPIs up to Rs 10,000 (with cash loading facility) and PPIs up to Rs 10,000 (with no cash loading facility).
4. PPIs can be loaded/reloaded by cash, debit to a bank account, or credit and debit cards.
5. The cash loading of PPIs is limited to Rs 50,000 per month subject to the overall limit of the PPI.

Who can issue PPI instruments?

1. PPIs can be issued by banks and non-banks after obtaining approval from the RBI.
2. As on 9 November 2022, over 58 banks including Airtel Payments Bank, Axis Bank, Bank of Baroda, Jio Payments Bank, Kotak Mahindra Bank, Standard Chartered Bank, UCO Bank and Union Bank have been permitted to issue and operate prepaid payment instruments.
3. There are 33 non-bank PPI issuers as on 30 May 2023. Some of the non-bank PPI issuers are Amazon Pay (India), Bajaj Finance, Delhi Metro Rail Corporation Ltd, Manappuram Finance Ltd, Ola Financial Services, Razorpay Technologies and Sodexo SVC India Pvt.

What has the RBI committee recommended?

1. The committee said the RBI has authorised a number of banks and non-banks entities to issue PPIs in the country recently.
2. The money kept in wallets is in the nature of deposits. However, currently, the DICGC cover extends only to bank deposits.
3. Being deposits with the PPI issuers who are also regulated by the Reserve Bank, extending deposit insurance to the PPI segment needs examination, the RBI-appointed committee recommended.
4. The Reserve Bank may examine whether Deposit Insurance and Credit Guarantee Corporation (DICGC) cover can be extended to bank PPIs and later to nonbank PPIs based on experience gained, it said.

What is DICGC?

1. DICGC is a wholly-owned subsidiary of the RBI and provides deposit insurance. The deposit insurance system plays an important role in maintaining the stability of the financial system, particularly by assuring the small depositors of the protection of their deposits in the event of a bank failure.
2. The deposit insurance extended by DICGC covers all commercial banks including local area banks (LABs), payments banks (PBs), small finance banks (SFBs), regional rural banks (RRBs) and co-operative banks, that are licensed by the RBI.
3. The number of registered insured banks as on 31 March 2023, stood at 2,027, comprising 140 commercial banks and 1,887 co-operative banks.

India tops digital payments rankings globally

GS Paper - 3 (Economy)

India has topped the global rankings in digital payments for the year 2022, data from govt's citizen engagement platform MyGovIndia showed on 10 June 2023. During the year under review, there were 89.5 million digital transactions in the country. India accounted for 46 per cent of the global real-time payments in 2022, which was more than the combined digital payments the next four top countries.

What

1. India has witnessed new milestones in digital payments, in value and volume terms. This shows the robustness of India's payment ecosystem as well as the country's acceptance of the digital.
2. Brazil took the second place, with the country clocking 29.2 million digital transactions. China followed at third spot with 17.6 million transactions.
3. Thailand was number four with 16.5 million transactions. South Korea followed with 8 million transactions.
4. India is number one in digital payments and that it's transforming the country's rural economy.
5. India is one of the countries where mobile data is the cheapest. Today, the country's rural economy is transforming.
6. MyGovIndia is a Citizen engagement platform of the Government of India, giving people the opportunity to work towards their ideas and grass root level of contribution.

Government releases malware tools

GS Paper - 3 (ITC)

Malware and online threats continue to disrupt, damage, affect, and squeeze out benefits. However, the Government of India is here to provide us with a safer cyber environment and help users battle online threats. The centre can be used for timely detection, cleansing, and minimising its implications on our gadgets.This is an initiative as a part of Digital India under the Ministry of Electronics and Information Technology (MeitY).

More about the News:

ü  The government has set up a cyber agency, “Cyber Swachhta Kendra” (CSK), which has a botnet cleaning and malware analysis centre with special tools developed with the help of Internet Service Providers (ISPs) and a few anti-virus companies.

ü  This can be used to clean a gadget that has been infected by malware.

ü  The following are the free botnet removal tools that are provided by the CSK:

• eScan Antivirus
• K7 Security
• Quick Heal

ü  Apart from these, the website also provides the user with additional tools that will add another layer of safety to the USB drives and web pages

ü  The portal of CSK lists down two applications for Android phone and tablet users in order to clean the botnet malware from the device.

ü  The apps provide the user with a security toolkit for the phones that are running Android. The following two applications can be downloaded from the Play Store:

• eScan CERT-In Bot Removal
• M-Kavach 2 (by C-DAC Hyderabad)

ü  The cyber agency has other useful tools that can help you safely operate external storage devices like pen drives and hard discs.

ü  The app ‘USB Pratirodh’ can be installed on the Windows device to monitor devices plugged into the machine. You can also password-protect the USB devices, scan for malware, and encrypt data using the same application.

Android Botnet : DAAM

ü  The government recently alerted all the users of a “highly dangerous” Daam Android botnet.

ü  The CERT-IN, which is an Indian cyber agency, issued an advisory against “Daam.”

ü  This botnet is responsible for stealing personal data, fooling the antivirus, or deploying any ransomware on affected gadgets.

ü  It also facilitates communication with other APK files on the infected Android device.

ü  The botnet was spreading through the dark web and applications that users tend to download.

Flashback:

ü  India witnessed 13.91 Lakh cyber security incidents in 2022 as per Minister of State for Electronics and Information and Technology

ü  The number of reported cyberattacks, however, fell in 2022, down from 14.02 Lakhs in 2021.

ü  As per government figures, 2.08 Lakh incidents were reported in 2018, 3.94 Lakh attacks were recorded in 2018 and 11.58 Lakh cybersecurity incidents were reported to CERT-In in 2020.

ü  As per a report, cyberattacks on Indian government agencies more than doubled in 2022 as the country emerged as the most frequently targeted country in the world in this aspect.

ü  Besides, multiple Indian agencies from Oil India Limited, Ladakh Power Grid, UIDAI and other agencies have allegedly been attacked in multiple such attacks in the past few years.