- Why in news
- On 24 March 2026, the Finance Ministry told Rajya Sabha that RBI has revised its 2017 rules on customer liability in unauthorised electronic banking transactions. The draft was issued for public consultation on 6 March 2026.
- What it is
- RBI's framework on limiting customer liability in unauthorised electronic banking transactions sets out when a customer bears a loss and when the bank must compensate. It dates from 2017. The revised draft adds a compensation mechanism for small-value frauds, as digital payments have grown fast.
- Original instructions
- RBI first issued the rules on limiting customer liability in unauthorised electronic banking transactions in 2017.
- IDPIC
- The Indian Digital Payment Intelligence Corporation was incorporated on 16 October 2025 as a Section 8 company under the Companies Act, 2013. Its mandate is to detect, prevent and analyse digital payment fraud in real time.
- MuleHunter.AI
- This is an AI/ML-based tool for detecting mule accounts, rolled out by RBI. It is live in 26 banks and is being scaled up.
- Financial Literacy Week
- It has been held every year since 2016.
Don’t confuse with Mule account vs fraudster's own account: A mule account belongs to a person used to receive and pass on stolen money, which hides the trail of funds (layering).
Don’t confuse with RBI Kehta Hai vs SEBI vs SCAM: RBI Kehta Hai is RBI's awareness campaign on safe banking. SEBI vs SCAM is SEBI's fraud awareness campaign on securities markets.
Economy terms and data: 42 Prelims questions since 2013, rising in recent years; they test what a term or instrument means. In Mains, 12 news-triggered questions.
Why it matters
- Clear compensation rules raise customer trust in digital payments.
- AI-based fraud detection helps catch mule networks early.
Problems
- Fraud methods change faster than rules and tools, and mule accounts are hard to trace.
- Low digital and financial literacy, especially among senior citizens, leaves users exposed.
Way forward
- Finalise the framework after consultation, with clear timelines for bank compensation.
- Scale up tools such as MuleHunter.AI across banks and share fraud data through IDPIC.
Put in your answer
MuleHunter.AI: Example of RBI using AI/ML to detect mule accounts, live in 26 banks.
IDPIC: Example of an institutional response to digital payment fraud, set up as a Section 8 company.
Centres for Financial Literacy: Data point on community-led financial literacy: 2,421 CFLs as on 31 March 2025.
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UPSC’s own questions that come close to this issue, from our Prelims and Mains banks.
No practice question for this one; the card may still help an answer. Why: Draft revised customer liability rules, IDPIC and MuleHunter.AI. Still a draft, so Prelims facts are unsettled.
Worth revising until Prelims 2027: most news questions come within two years of the event.