With the rise of digital transactions in India, facilitated by increasing accessibility to technology, most activities including shopping, banking, and bill payments are conducted from the comfort of home. However, a recent survey has revealed that many consumers are falling prey to fraudulent activities on these platforms.
Consumers are enticed by attractive cashback offers and subscription rewards promised by online payment platforms. Many join these platforms and shop for advertised products, only to find that the promised cashbacks and rewards never materialize. These deceitful practices have been spotlighted by the Central Consumer Protection Authority (CCPA), which has identified 13 different deceptive advertising and unfair commercial practices including hidden charges, subscription traps, and bait-and-switch schemes.
According to the survey, 52% of respondents faced issues related to hidden charges, while 67% were caught in subscription traps. About 62% encountered the bait-and-switch problem where attractive offers lure consumers into additional payments without delivering the promised incentives.
In response to these fraudulent activities, the Indian government declared such practices illegal in December 2023, warning that online payment platforms engaging in these deceitful practices could face fines up to Rs. 10 lakhs.
