The Reserve Bank of India (RBI) has floated a significant proposal to introduce a mandatory one-hour delay for all digital money transfers exceeding Rs 10,000, specifically targeting services like UPI, IMPS, and RTGS. Under this proposed framework, while a transaction would be initiated instantly, the actual credit to the recipient’s account would be held for sixty minutes, providing a crucial “cooling-off” period for users to cancel or report unauthorized transactions. This move comes as a direct response to the alarming rise in sophisticated digital banking scams and “mule account” frauds that often see stolen funds siphoned through multiple layers of accounts within minutes. Central bank officials believe that this time buffer will serve as a vital safety net, giving victims of phishing or accidental transfers a window to alert their banks and freeze the funds before they are permanently withdrawn by fraudsters.
The proposal suggests that this delay might primarily apply to the first-time transaction between two users who have not previously shared a digital link, thereby minimizing inconvenience for regular, trusted payments like monthly bills or peer-to-peer transfers among known contacts. While the fintech industry has raised concerns regarding the potential impact on the “instant” nature of India’s digital payment ecosystem, the RBI emphasizes that security must evolve alongside speed. If implemented, the banking servers would send an immediate notification to both the sender and the receiver, but the final settlement would remain “pending” for the duration of the hour. Industry experts suggest that this layer of friction, though seemingly a step back in terms of convenience, is a necessary trade-off to protect vulnerable citizens and maintain long-term public trust in the national payment infrastructure. The RBI is currently seeking feedback from various stakeholders and technology partners to refine the technical execution of this plan before it becomes a standard operating procedure for the 2026-27 fiscal year.
