Digital Scams and Cybercrime in India

 GS-III – Internal Security  

• As daily life is becoming more centred on digital transactions, concerns around online safety and privacy have grown exponentially, with digital scams proliferating at an unprecedented rate.
• The data from the National Crime Records Bureau (NCRB) highlights this the best.
• Cybercrime cases rose 17.9 per cent nationally, from 86,420 in 2023 to 1,01,928 in 2024, even as overall registered crime declined by 6 per cent in the same period.
• A recent study by Lokniti-Centre for the Study of Developing Societies (CSDS) and Common Cause of 8,306 citizens across 16 States captures the much larger, invisible layer on the scale and magnitude of this problem, examining:
  • How frequently citizens encounter fraud calls/messages.
  • Who is targeted.
  • The social profile of those most exposed.

Scale of the Scams

• Nearly a third of the citizens reported frequently (“many times” and “sometimes”) receiving calls about deliveries they never ordered (33%).
• Regularly encountered high-return investment scam calls (31%).
• More than a fourth (27%) frequently received calls from bank officials asking for personal account details.
• About a fourth received calls:
  • About their phones being linked to illegal activities (23%).
  • From an unknown number claiming to be their friend urgently in need of money (23%).
• A fifth of the respondents frequently received calls from police or someone in authority claiming that their friend or relative is in danger or has committed some type of crime.
• However, it is important to note that a majority, roughly half to six in ten respondents, have never received these calls.
• Respondents who spend more time online were more likely to be targeted by fraudsters.
• Among respondents with high online usage:
  • 18 per cent fall in the high scam-exposure category.
  • 28 per cent in the moderate category.
  • Together, over 46 per cent report scam exposure.
• In contrast, among those who do not use the internet:
  • Only 5 per cent report high exposure.
  • 14 per cent report moderate exposure.

Exploiting the Digital Footprint

• The common thread is deeper integration into the digital ecosystem creating a larger footprint for fraudsters to exploit.
• Instead of relying solely on technical expertise, fraudsters target social relationships and institutional credibility.
• Investment scams appeal to the aspiration of getting rich quickly.
• Delivery scams draw on trust in e-commerce.
• Bank impersonation uses institutional credibility.
• Fake police calls exploit fear of authority.
• By manipulating familiar relationships and situations, fraudsters are able to effectively make deception appear legitimate.

Actual Harm

• Data shows that 13 per cent of the people were a direct victim of cybercrime in the last two to three years.
• Among them:
  • More than half (54%) of the people have experienced financial fraud.
  • 13 per cent said their devices were hacked.
  • 11 per cent reported personal data theft.
  • 7 per cent reported cyberbullying or abuse on social media.
  • 4 per cent reported online sexual harassment.

Targets of Financial Fraud

• Financial frauds are more layered around social and economic position.
• The wealthiest people (57%) are most vulnerable to financial frauds, though nearly half of economically disadvantaged respondents (47%) are victims of digital fraud too.
• Similarly, the more educated a respondent is, the more likely they are to be a victim of cybercrime.
• 40 per cent of those without any formal education are victims of financial fraud, as compared to nearly three in five (59%) college graduates.

Financial Losses

• The losses incurred due to frauds are substantial.
• Over eight in ten victims of cybercrime reported some financial loss.
• A quarter (23%) lost upwards of ₹20,000.
• 8 per cent of respondents have lost up to ₹1,000.
• Another 25 per cent have lost between ₹1,001–₹5,000.
• Cumulatively, about 29 per cent have lost between ₹5,000 and ₹20,000.

Conclusion

• In essence, fraudsters in India, all the while exploiting ignorance and vulnerability, are also systematically tracking digital participation aiming to catch those with resources.
• Fraud in this sense, has less become a tax on carelessness than a tax on connectivity itself.

UPSC Mains Practice Question

Q. Digital scams are proliferating at an unprecedented rate with fraudsters increasingly exploiting digital participation. Discuss the scale and magnitude of digital fraud and its impact on citizens.