Tips to avoid OTP Frauds

The push toward the digital economy is big boon. But it has its challenges too. Digital economy has made transactions much convenient and secure as people no longer need to carry large amounts of physical cash. With digital wallets you can receive of transfer money, pay your bills or make online purchases with a simple scan. However, there are certain challenges of digitisation that must not be overlooked. Scammers are more active than ever before, and a new method of duping customers is OTP fraud.
 

What is OTP?

 
A one-time password, also known as an OTP, is a security code that you receive on your mobile phone or email address when you make a financial transaction. Its primary purpose is to verify your identity and prevent security breaches that result in monetary fraud or data theft.
 
When you log into your bank account online you need to enter your details. Though the username and password remain the same, every time you log in the security code changes. This is to ensure two-step verification to avoid fraudulent practices. Even if someone gets your username and password by mistake, they cannot log into your account without the OTP.
 

How do OTP scams take place?

 

1. Impersonation

   Fraudsters may contact you while posing as real financial company executives. Then they ask for your personal information, which they record in their software. Following that, you will receive an OTP, upon which your data will be shared with them immediately. They can use this information to perform financial transactions from your account.
    

2. Malware Installation

   We have a bad habit of storing all sensitive information on our smartphones. But do you know that saving your sensitive data on your phone exposes you to a big threat. Scammers may send you faulty links that could lead to malware installation. Such malwares shares all your information including the real-time OTP with the scammers.
    

3. Asking for your OTP

   Scammers use a variety of techniques to compel you to reveal your OTP. For example, they may try to dupe you by requesting OTP in order to disburse an interest-free loan. They may impersonate as anyone and ask you for your details. But it is important to note that neither banks nor any reputed organization ever asks you for sensitive information.
    

Also Read: 6 Ways to Spot a Loan Scam
 

Tips to avoid OTP frauds

 

1. Avoid Suspicious Apps

   On the PlayStore, there are numerous fake lending and payment apps. These apps exist solely to steal sensitive data. You will be asked to provide your name, address, PAN details, and Aadhar number shortly after installing such apps. Your data is stored in the fraudster's database as a result of your entry.
    
   They will use these details to obtain information about your outstanding debts. Once they have the data, they call you and pose as an official, and threaten you to share sensitive information.
    

2. Avoid Suspicious Links

   Nowadays, data-farming companies share their customers' email addresses and contact information with third parties for lead-generation purposes. Spammers use such companies to obtain the email addresses of their target clients.
    
   Once they have the data, they begin sending out mail with lucrative loan offers, credit cards with numerous perks, and other offers. If you fall for such emails and click on the link, not only will your information be shared, but there is also a chance that malware will be transmitted, giving fraudsters access to your device.
    

3. Avoid Cyber Cafes

   This is a common blunder that people make. People often visit cybercafes to fill out examination forms, transfer funds, or shop online. However, these locations are extremely vulnerable to data breaches. Scammers target these locations to instal malware. This exposes you to a big threat of losing money.
    

4. Fake Contact Details

   This is most commonly seen in email or text message fraud. If you receive a lucrative pre-approved personal loan offer in the mail, you will notice contact information at the bottom. If you call that number, the person on the other end of the line will ask you for sensitive information.
    
   If the email is sent in the name of a recognised lender, always cross-check the phone number with the one on the genuine lender's official website. Proceed only if the number matches.
    

5. Secure Website

   Always check whether the website is HTTPS or HTTP. HTTPS websites are thought to be more secure, and the risk of scammers stealing your data and then calling you to commit OTP fraud is reduced.
    

Also Read: Why Clicking on Suspicious Links Can be the Biggest Mistake of Your Life?
 

Final Words

 
OTP fraud is becoming increasingly common. However, you can avoid such incidents by conducting your financial transactions securely. You must also increase your awareness about cyber threats and cyber security and must stay abreast of such new scams. You must avoid responding to scam emails, clicking on suspicious links or sharing your information over phone.
 
If you suspect any fraudulent practices then notify your financial institutions immediately. You must also lodge an FIR and file a complaint with the cybercrime cell. A little caution can save you from a big financial loss!