How One ‘Kill Switch’ Button Could Crack Down On Digital Arrest Scams

Cases of digital arrest and online fraud are rising sharply nationwide, prompting the government to take urgent measures. In response, the Ministry of Home Affairs established a high-level committee last

year to examine the growing threat of digital arrests and related financial scams.

The committee has since put forward a set of recommendations, some of which are expected to be implemented in the near future to strengthen safeguards against such fraud.

‘Kill Switch’ Proposed To Stop Scams Instantly

One of the key recommendations of the committee is the introduction of a ‘kill switch’. This feature would allow users to block all financial transactions instantly by pressing a single button if they suspect digital fraud.

Once activated, the kill switch would temporarily freeze all bank accounts linked to the user, preventing fraudsters from withdrawing money or carrying out further transactions.

Recovery Of Financial Losses

Beyond immediate prevention, the committee has also suggested mechanisms to help recover money lost during digital arrest scams.

The idea is to stop funds from being quickly transferred or split into multiple mule accounts, which often makes recovery difficult.

Insurance Cover For Banking Fraud Losses

The committee has proposed the introduction of an insurance system to compensate victims of banking fraud. With digital scams increasing rapidly, commercial banks are being pushed to reassess their risk management frameworks.

The proposed insurance products would be launched alongside the kill switch to offer stronger protection to customers and the financial ecosystem.

Emergency Button On Banking And Payment Apps

An inter-departmental committee was formed last December to work specifically on implementing the kill switch. Among the options being explored is the addition of an emergency button on payment platforms and banking apps.

If a user believes they are being scammed, pressing this button would immediately freeze all banking operations.

Possible Integration With UPI And Bank Apps

A senior government official stated that the government is examining whether the kill switch can be integrated into popular payment platforms such as UPI and bank apps.

Once activated, no financial transaction would be allowed until the situation is reviewed.

Tracking Suspicious Transactions And Mule Accounts

The committee is also evaluating whether potentially fraudulent transactions can be identified in real time.

It is exploring ways to prevent fraudsters from rapidly dispersing stolen funds across multiple mule accounts, thereby improving the chances of recovering the money.

How Digital Arrest Scams Operate

In digital arrest scams, fraudsters contact victims through video calls while posing as police or law enforcement officials. They claim the victim is under investigation for serious crimes and use leaked personal data to appear convincing.

By creating fear and urgency, and displaying fake identity cards or arrest warrants, they extort large sums of money.

According to the RBI’s Trend and Progress of Banking in India report, by the financial year 2024-25, there were 23,879 reported fraud cases nationwide, resulting in losses amounting to Rs 34,771 crore.

RBI’s Digital Payment Protection Proposal

The RBI’s Payment Vision 2025 report has proposed the creation of a Digital Payment Protection Fund (DPPF). This fund aims to safeguard customers who fall victim to digital fraud, as well as payment instrument issuers.

While multiple insurance models already exist, experts favour the creation of a pooled insurance mechanism. This would involve banks, insurance companies and possibly regulatory oversight, offering a more structured and reliable safety net against digital fraud.