10 precautions to safeguard your finances: A comprehensive guide to online money transfers

MAHESH PAI highlights ten crucial ways to protect oneself when transferring money online

In an era where digital transactions have become the norm, the convenience of transferring money online in India comes with an increasing risk of scams. This  risk is particularly concerning for the elderly population, who often find themselves targeted by fraudsters. The most common means of transfer are Unified Payments Interface (UPI), National Electronic Funds Transfer (NEFT),  Real Time Gross Settlement (RTGS), and Immediate Payment Service (IMPS).  Below are 10 crucial precautions to take before transferring any money.

1. Verify the recipient’s identity
Before initiating any online money transfer, it is extremely necessary to verify the recipient’s identity thoroughly. Use secure channels of communication, such as verified phone numbers or official emails, to cross verify details. By doing so, you  inimise the risk of falling victim to impersonation or identity theft.

2. Use secure payment platforms
Opt for reputable and secure payment platforms or banking apps. Choose wellestablished services that employ encryption and multi-layered security protocols. Avoid using unfamiliar or unsecured platforms, as they may be susceptible to fraudulent activities. Your choice of payment platform plays a  crucial role in the safety of your transactions. When transferring money to someone for the first time, choose for bank transfers rather than UPI, despite the latter’s convenience. A secure method is always preferable.

3. Enable Two-Factor Authentication and don’t rush
Always activate Two-Factor Authentication  (2FA) wherever possible. This additional layer of security adds an extra step to the authentication process, making it significantly more challenging for scammers to gain unauthorised access  to your  accounts. Also, never transmit large sums of money without careful consideration. When you wait until the last minute to complete tasks, you are  occasionally rushed and frequently ignore little warning signs. Furthermore, your  brain could not have processed information that could have stopped a scam.

4. Update and secure devices
Regularly update the security software on the devices you use for online  transactions. This includes smartphones, computers, and any other devices involved in financial transactions. By maintaining up-to-date antivirus and anti- malware programs, you create a robust defense against potential threats that may compromise your financial information.

5. Educate yourself about common scams
Staying informed about prevalent online  scams in India is crucial. Awareness is the first line of defense against fraud. Common scams include phishing, vishing (voice phishing), and fake lottery schemes. Knowing the red flags and tactics employed by scammers empowers you to recognise and avoid potential threats.

6. Beware of unsolicited calls and messages
Exercise caution when receiving unsolicited calls or messages that request  personal or financial information. Legitimate institutions will not ask for sensitive details over the phone or through messages. Be skeptical of unexpected communication, and verify the authenticity of such requests through official channels.

7. Keep Personal Information Confidential
Never share personal or financial  information, such as passwords, Personal Identification Number (PINs), or One-Time Password (OTPs), with anyone. Legitimate organisations will never ask for such details through unsolicited communication. Safeguarding your confidential information is crucial in preventing unauthorised access to your financial accounts.

8. Regularly Monitor Bank Statements
Frequently review your bank statements to identify any unauthorised or suspicious transactions. Timely detection of discrepancies allows you to take swift action, notifying your bank and preventing further financial damage.

9. Have two bank accounts
Consider using one bank account for online transactions by doing this you will be reducing the risk of fraud. This precaution is particularly effective in protecting your financial information during online purchases.

10. Seek assistance from trusted individuals
When in doubt, seek the advice of trusted  family members, friends, or financial advisors before making significant online transactions. A second opinion can provide valuable insights and help identify potential red flags that you might have overlooked. As the number of online scams continues to rise in India, taking precautions before transferring money online is paramount.  Older individuals, in  particular, are vulnerable to scams, making it essential for everyone to stay vigilant. By following these 10 precautions, you can contribute to a safer online environment, protecting yourself and your loved ones from falling victim to financial fraud. Stay informed, stay cautious, and prioritise the security of your online transactions.

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