The Reserve Bank of India (RBI) released a discussion paper on April 9, 2026, proposing targeted friction in high-value digital transfers. This aims to combat Authorised Push Payment (APP) fraud, where users are tricked into sending money themselves.
1. THE “GOLDEN HOUR” PROPOSAL
The 1-Hour Delay Rule
- Threshold: Transactions over ₹10,000.
- Mechanism: The payer’s account is debited instantly, but the credit to the beneficiary is delayed for one hour.
- The “Kill Switch”: During this window, the sender can cancel the transaction if they suspect foul play.
- Scope: Primarily for person-to-person (P2P) transfers. Merchant payments (e.g., QR codes at shops) are generally excluded to maintain convenience.
Protection for Vulnerable Users
The paper outlines specific safeguards for senior citizens (70+) and persons with disabilities:
- Trusted Person Authentication: For transfers above ₹50,000, a pre-designated “trusted individual” may need to approve the transaction.
- Mule Account Scrutiny: Proposed cap of ₹25 lakh annual credit on accounts without “enhanced due diligence” to prevent money laundering.
BACKGROUND CONCEPTS: Q&A FORMAT
Q: What is “Authorised Push Payment” (APP) Fraud?
A: This is when a fraudster tricks you (via a fake call or message) into willingly authorizing a payment. Since you used your PIN/OTP, traditional security doesn’t stop it. The 1-hour lag creates a psychological “break” to help victims realize the scam.
CONCEPTUAL MCQs
Q1. According to the RBI discussion paper, the 1-hour delay is proposed for transactions above which amount?
A) ₹1,000
B) ₹5,000
C) ₹10,000
D) ₹50,000
E) ₹1,00,000
Q2. For vulnerable users (senior citizens), the RBI has suggested additional authentication for transfers exceeding:
A) ₹10,000
B) ₹25,000
C) ₹50,000
D) ₹1,00,000
E) No limit specified.
Q3. What was the primary reason cited for the 4-year high in banking system liquidity?
A) A sudden increase in bank locker charges.
B) Maturity of Government Securities (G-Secs).
C) Decrease in the number of bank accounts.
D) Massive withdrawal of cash by the public.
E) Closure of the UPI network.
Q4. The "Kill Switch" mentioned in the RBI paper allows a user to:
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A) Delete their bank account permanently.
B) Instantly disable all digital payment channels in case of fraud.
C) Increase their daily transfer limit.
D) Change their ATM PIN remotely.
E) Turn off the bank’s mobile app.
Q5. When the banking system has a “Net Liquidity Surplus,” it generally means:
A) Banks are running out of cash.
B) Banks have more funds than they currently need for lending.
C) The government is borrowing more from the public.
D) The RBI is increasing the CRR (Cash Reserve Ratio).
E) Foreign investors are withdrawing from the stock market.
ANSWERS & EXPLANATIONS
| Question | Answer | Explanation |
| Q1 | C | ₹10,000 is the threshold where the 1-hour lag begins. |
| Q2 | C | The higher threshold (50k) is aimed at protecting life savings from coercion. |
| Q3 | B | When G-Secs mature, the RBI/Govt pays back the principal to banks, creating a cash surplus. |
| Q4 | B | It is a “panic button” to stop all digital outflows instantly. |
| Q5 | B | Surplus liquidity means banks are parking money with the RBI rather than borrowing from it. |
EXAM RELEVANCE
| Exam | Focus Area | Relevance Level |
| RBI Grade B | Phase II (Finance – Digital Payments & Liquidity Management) | Critical |
| SBI / IBPS PO | Banking Awareness (Current RBI Circulars) | High |
