What is identity theft?
Identity theft refers to the unauthorized use of someone’s personal information—like government ID numbers, biometrics, or login details—typically for committing financial fraud.
Victims often encounter fraudulent loans, unauthorized charges, or damage to their credit scores.
Last year, the Reserve Bank of India reported over 6,600 complaints of digital fraud, highlighting the magnitude of this issue.
The limits of personal vigilance
“Maintaining good digital hygiene is crucial,” asserts Rahil Patel, Chief Growth Officer at QNu Labs. “Implement strong passwords, enable two-factor authentication, and regularly review your credit reports.”
However, he cautions that traditional security measures may soon be inadequate.
“Quantum computing is on the horizon. Once it reaches full potential, current encryption methods may be compromised. Attackers are already storing encrypted data for future exploitation,” he mentioned.
Patel encourages financial institutions to transition to quantum-resistant cryptography before the opportunity to act diminishes.
Rethinking the fraud response
Vibhore Goyal, Founder at OneBanc, contends that the existing methods for preventing fraud are obsolete. “Advising people to be more cautious is no longer sufficient. Industrial-scale fraud driven by AI can circumvent basic safeguards.”
He asserts that fraud detection requires a comprehensive rethink. “Payment systems must evaluate transactions using real-time behavioral data. Devices should be deemed untrusted until confirmed. Outmoded technologies like static card numbers should be eliminated.”
Goyal urges regulated entities to take on more responsibility in protecting users.
Practical steps for consumers
Neehar Pathare, MD, CEO & CIO at 63SATS Cybertech, offers practical recommendations for individuals to minimize their risk:
- Create unique, complex passwords for each financial account
- Activate multi-factor authentication
- Refrain from clicking on unfamiliar links or replying to unverified messages
- Regularly monitor bank and credit card transactions
- Utilize a VPN on public Wi-Fi networks
- Act quickly upon noticing any suspicious activity
- Consider acquiring cyber insurance for additional protection
“A minor lapse can result in significant financial and reputational damage,” warns Pathare. “Timely detection is crucial.”
Role of institutions and technology
Sarika Shetty, CEO and Co-founder at RentenPe, emphasizes the need for collaborative efforts. “Preventing identity theft demands a multi-layered approach. Technology should complement consumer education and institutional accountability.”
She advocates for AI-driven monitoring solutions, digital behavior analytics, and enhanced identity verification processes. “Banks and NBFCs must partner with credit bureaus and regulators to increase awareness and implement more effective security measures.”
