RBI fraud compensation: get back up to ₹25,000 from 2027
RBI will compensate small digital fraud victims 85% of net loss, up to ₹25,000, from 1 Jan 2027. Know the 5-day reporting rule and who is covered.
If you lose a small amount to an online scam, getting money back from the bank has often felt like a lottery. The Reserve Bank of India has now announced a compensation scheme aimed at exactly these everyday cases. It starts on 1 January 2027, so this is a good time to understand it and set yourself up properly.
What the RBI has announced
According to reports on the RBI's amendment directions dated 24 June 2026, eligible victims of small-value digital fraud can receive compensation of 85% of their net loss or ₹25,000, whichever is lower. Some key points:
- It covers losses of up to ₹50,000.
- It is a one-time benefit per customer, for life.
- It applies to transactions made on or after 1 January 2027, and reports describe the scheme as running for frauds within the first year.
- "Net loss" means what you lost minus anything already recovered.
A simple example
Say you lose ₹40,000 and your bank manages to recover ₹15,000. Your net loss is ₹25,000. At 85%, the compensation works out to ₹21,250.
For a smaller loss of ₹10,000 with nothing recovered, the compensation would be ₹8,500. For a loss near the upper end, the ₹25,000 cap applies.
The five-day rule
This is the part most people will miss. You must report the fraud to both your bank and the National Cyber Crime Reporting Portal (or the helpline 1930) within 5 calendar days. Miss the window and you can lose your claim.
Zero liability is a different thing
The RBI directions also restate when you owe nothing at all:
- If the fraud happened because of bank negligence, your liability is zero.
- If it came from a third-party system breach and you report within 5 days, your liability is zero.
- If you were careless, for example by sharing an OTP or PIN, you can bear the losses up to the time you report. The new compensation is meant to soften this for genuine victims, but it is capped and one-time.
Banks are also expected to resolve fraud complaints within about 45 days for domestic cases, and reports mention instant SMS alerts for electronic transactions above ₹500.
Who may not be covered
Reports say customers of some bank categories, such as small finance banks, payments banks, regional rural banks and local area banks, may be left out, and that for joint accounts only one holder can claim. Details can change, so check your own bank's notice before assuming you are covered.
Practical takeaways
- Never share OTPs, PINs or passwords. Compensation is a safety net, not permission to relax.
- Act within 24 hours if something looks wrong. Call 1930, then your bank, and note the time.
- Keep evidence: screenshots, transaction IDs, the number or UPI ID that received the money.
- Turn on every alert your bank offers, and keep your registered mobile number current.
- Use a separate account for daily UPI spending with a modest balance, so a mistake costs less.
- Review your statement weekly. You can only report what you notice.
This is general information, not financial advice.
How Dhuddu can help
The five-day rule only works if you spot a bad transaction quickly. Dhuddu syncs your bank alerts from Gmail and lets you import statements, so every debit lands in one list you can scan in a minute. Try it free at dhuddu.in or on Google Play.