Financial Technology and Customer Safety
Financial technology and customer safety examines how technology changes financial services and how customers are protected from fraud. Questions cover e-KYC, digital lending, data protection and RBI liability rules.
Key concepts
- Fintech includes digital lending, insurtech, wealthtech, account aggregators and API-based banking.
- e-KYC uses Aadhaar or video verification; data must be collected with consent.
- The DPDP Act, 2023 gives individuals rights over personal data and imposes duties on data fiduciaries.
- Common frauds: phishing links, vishing calls, smishing SMS, SIM swap, juice jacking and remote-access scams.
- RBI’s limited-liability framework: zero liability if the unauthorised transaction is reported within three working days; liability increases with delay.
Worked example
A customer gets an SMS: “Your KYC expires today; click this link to update.” Reasoning: banks do not send KYC-update links demanding credentials. The customer should not click, should verify through the official app or branch, and report the number to 1930 and cybercrime.gov.in.
Traps that cost marks
- Believing caller ID or a logo makes a call genuine.
- Sharing card CVV or allowing screen sharing.
- Reporting fraud weeks later and expecting zero liability.
- Assuming all fintech apps are RBI-regulated; many are agents or service providers.