Boom time for e-commerce in India; but customers face heightened risk of fraud
Friday, September 26, 2014
NEW DELHI: As more Indians step up to make online payments, there is a proliferation of payment gateways and mobile wallets, many of which are facing the risk of being misused by unscrupulous merchants.
Payment service providers like Citrus Pay and PayU claim the low interest rates offered by payment gateways — 1% compared with upto 3% — charged by credit card companies is being taken advantage of by several small traders who set up online stores and withdraw money citing fake transactions.
“We have suffered Rs 4.5 lakh of fraud out of which one ecommerce merchant sold a used ’car’ worth Rs 1 lakh to himself by his credit card,” said Nitin Gupta, CEO of PayU India, one of India’s leading payment gateways, which has over 30,000 e-commerce merchants registered with it.