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Essay: Protect Money: India’s Growing Concern of Cybercrime and Digital Revolution

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  • Published: 1 April 2019*
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A crime is an act or an exclusion which creates an offense that is punishable by law. Similarly, cybercrime is the use of a computer as an instrument to further illegal ends, such as committing fraud or violating privacy. Cybercrime is becoming common among nations today, and there is an obligation to minimize it. India is not indifferent when it comes to this issue, yet the cybercrime rate has been rising exponentially. The first reported cybercrime dates to the 1960s, where computers were predominantly on a mainframe. Mainframe computers were unconnected with other computers, hence only a few people could access them. These cybercrimes were inside jobs, which means that employees of an organization were involved in the crime. In the 1960s and 1970s, cybercrime was known as a computer crime as the internet was completely undeveloped then. With the introduction of the internet, cybercrime became more popular. Cybercrime refers to all activities done with a criminal intent in cyberspace. Such actions generally fall into three categories: 1) Cybercrime against individuals, 2) Cybercrime against business and non-business organizations and 3) Cybercrime against the government. Cybercrime has become one of the most popular crimes in recent times, which lead to $450 billion loss according to Hiscox Cyber Readiness Report 2017. Meanwhile, cybercrime in India is expanding at a rate of 50% per year, and India ranks 4th in the world in terms of cybercrime rates. Despite being one of the top five countries which are likely to be affected by organized cybercrime, the internet is largely used by millions in India. On the transition towards development, India is profoundly dependent on the internet. There are more than 460 million internet users in India, according to Cisco's Visual Networking Index (VNI). With the increasing popularity of the internet, the Government of India in 2016 revolutionized the monetary system in India, assigning it a digital look. The government launched this revolution with the policy of demonetization, during which the old Indian currency was banned (which were mostly hoarded by the rich to hide their black money). This gave rise to online transactions, which assisted the government to deal with black money, as now most transactions took place orderly. Many start-ups took advantage of this situation and came up the concept of the e-wallet, also called a digital wallet, which is a secure place that comprises one or more currency purses. This leads to a technology revolution in India. Currently, the Indian government is experimenting with a new form of a digital identity card which would help make these transactions more secure. Due to more frequent use of the internet for transactions in India, the cybercrime rate increased rapidly. According to reports by the Indian Computer Emergency Response Team (CERT-In), a new cybercrime is reported every 10 minutes in India. To deal with this recurring problem of cybercrime the Government of India has created a Crisis Management Plan to prevent cybercrimes. Mock drills are being conducted to find faults in cybersecurity of the government and critical sectors. Since 8th of November 2016, the banks in India are rapidly transforming and adopting newer technologies. Banks dependence on the internet has resulted in reducing costs drastically and has helped generate revenue through various channels. As per 2016 statistics by the RBI, the cost of a bank transaction on Branch Banking is estimated to be in a range of Rs.70 to Rs.75 while it is around Rs.15 to Rs.16 on ATM, Rs.2 or less on Online Banking and Rs.1 or less on Mobile Banking. The number of customers, adapting to the new technology has also increased because of the convenience in 'Anywhere Banking'. Digitization has reduced human error. It is plausible to access and analyse the data anytime permitting a robust reporting system. Commercial Banks in India have moved towards the new technology by way of Bank Mechanization and Automation with the introduction to MICR based cheque processing, Electronic Funds transfer, Interconnectivity among the bank Branches and implementation of ATM (Automated Teller Machine) Channel has resulted in the convenience of anytime banking. The launch of United Payments Interface (UPI) and Bharat Interface for Money (BHIM) by National Payments Corporation of India (NPCI) are significant steps for innovation in the Payment Systems domain. UPI is a mobile interface where people can make instant funds transfer between accounts in different banks based on virtual address without mentioning the bank account. According to the RBI Report in 2016-17, there are 222,475 Automated Teller Machines (ATMs) and 2,529,141 Point of Sale devices (POS). Implementation of electronic payment system like NEFT (National Electronic Fund Transfer), ECS (Electronic Clearing Service), RTGS (Real Time Gross Settlement), Cheque Truncation System, Mobile banking system, Debit cards, Credit Cards, Prepaid cards have all gained wide acceptance in Indian banks. These are all remarkable landmarks in the digital revolution in the banking sector. Online banking has transformed the face of banking and brought about a noteworthy transformation in the banking operations. National Electronic Funds Transfer (NEFT) is the most commonly used electronic payment method for transferring money from any bank branch to another bank in India. It operates in half hourly batches. At present there are 23 settlements, Real Time Gross Settlement (RTGS) is primarily used for high-value transactions which are based on 'real time'. The minimum amount to be remitted through RTGS is Rupees Two Lakhs and considers no upper limit. Immediate Payment Service (IMPS) is an instant electronic fund transfer facility offered by National Payments Corporation of India (NPCI) which is available uninterrupted. The usage of Prepaid payment instruments (PPIs) for the purchase of goods & services and funds transfers has increased considerably in recent years. The value of transactions through PPI Cards & mobile wallets have jumped drastically from Rs.105 billion and Rs.82 billion respectively in 2014-15 to Rs.277 billion and Rs.532 billion respectively in 2016-17. Even though demonetization has its perks like a cashless economy (digital economy) and a corruption free country, it still has some flaws which affect the overall economy. The GDP growth rate of 8.01% in 2015-2016 dropped to 7.11% in 2016-2017 after demonetization. This was largely due to less availability of cash in cash-intensive industries like manufacturing and construction. It has also adversely impacted the primary function of banks to issue loans and has put pressure on them as current account holders demand large sums of cash. It also led to high rate of unemployment, since a huge sum of Indian workforce belongs to the informal sector of the economy. They use cash to meet all their expenses, and demonetization has resulted in a lot of them losing their jobs due to unavailability of cash. According to CMIE’s Consumer Pyramids Household Surveys (CPHS), approximately 1.5 million jobs were lost during the final quarter of the financial year 2016-17. The estimated employment during this period was 405 million as compared to 406.5 million during the previous four months. Demonetization is a first step taken by the Indian Government into transforming India into a digitalized economy. With the increasing dependence on technology, the Government is facing many challenges to protect its citizens from a risk-free transformation. With the advancement of technology, every day a new problem occurs and old one finds a fix. The first step for any government to implement a policy is to provide assurance to their citizens, that indeed this policy is for the good of the whole nation. The dependence on the internet observes the emergence of cybercrime in India. The minister of State for Electronics and IT, Mr. PP Chaudhary stated that as per the information collected by India’s Computer Emergency Response Team (CERT-in), 44,679, 49,455 and 50,362 cybersecurity incidents took place in India during the years 2014, 2015 and 2016, respectively. These incidents include phishing, website intrusions, and defacement, virus and denial of service attacks amongst others. As per the ‘2016 Cost of Data Breach Study: India’ the average total cost of a data breach paid by Indian companies increased by 9.5 percent, while the per capita cost increased by 8.7 percent and the average size of a breach expanded by 8.1 percent. To combat these problems, the government of India has executed the following steps. National Cyber Security Policy, 2013: The policy is aimed at building a secure and resilient cyberspace for citizens, businesses and the government. Its mission is to protect cyberspace information, and infrastructure, build capabilities to prevent and respond to cyber-attacks and minimize damages through coordinated efforts of institutional structures, people, processes, and technology. The objectives of the policy include creating a secure cyber ecosystem, and compliance with global security standards, strengthen the regulatory framework, creating round the clock mechanisms for gathering intelligence and effective response and to build public-private partnerships for cooperative cybersecurity efforts. Cyber Swachhta Kendra: To combat cybersecurity violations and avoid their increase, Government of India’s Computer Emergency Response Team (CERT-in) in February 2017 launched ‘Cyber Swachhta Kendra’ a new desktop and mobile security solution for cyber security in India. Its functions are to analyse BOTs/malware characteristics, provides information and empowers citizens to remove BOTs/malware and to generate awareness among citizens to secure their data, computers, mobile phones and devices such as home routers. The Cyber Swachhta Kendra is a step in the direction of creating a secure cyber ecosystem in the country as intended by the National Cyber Security Policy in India. They strive to increase awareness of common users regarding botnet, malware infections and measures to be taken to prevent malware infections and secure their computers, systems, and devices. Collaboration with industry partners: Development of Public-Private Partnerships is a critical strategy under the National Cyber Security Policy 2013. The government has collaborated with Antivirus company Quick Heal, who is providing a free bot removal Tool. To combat the ever-evolving techniques of cyber intrusions, the government also recognizes the need for working in collaboration with industry partners. Consequently, Cisco and Ministry of Electronics and Information Technology’s Indian Computer Emergency Response Team (CERT-In) have signed a Memorandum of Understanding whereby a threat intelligence-sharing programme will be established, wherein personnel from Cisco and CERT-In will work collectively to tackle digital threats and evolve and incorporate new ways to improve cybersecurity. International Cooperation Initiatives: Information sharing and cooperation are an explicit strategy under the 2013 Policy. Consequently, as an answer to the increasingly international nature of cybercrime, the Indian government has entered into cybersecurity collaborations with countries like the USA, European Union, and Malaysia. The U.K. has agreed to assist in developing the proposed National Cyber Crime Coordination Centre in India. The areas of the corporation provide inter alia that both countries agree to share and implement cybersecurity best practices, share cyber threat information on a real-time basis, evolve joint mechanisms to reduce cyber threats, promote cooperation between law enforcement agencies and develop their capacity through joint training programs. Experts have indicated setting up of a National Cyber Security Agency (NCSA) to address cybersecurity issues and improve implementation at a national level. Such an agency is suggested to be equipped with staff that is technically proficient in both defensive and offensive cyber operations, to encrypt platforms and gathers intelligence. Another proposed measure is setting up of a National Cyber Coordination Centre (NCCC) as a cyber-security and e-surveillance agency. Which screens communication metadata and coordinates the intelligence gathering activities of other agencies. NCCC received prima facie approval in May 2013 to operate under the National Information Boards. However, establishing an NCCC like body would require compliance and adherence to international privacy law standards. Digital India is already in the works, and India is rapidly progressing into its transformation. But with the population being 1.3 billion there tend to be internal factors like social and economic factors affecting this process. With literacy rate being 71.96% according to Indian Statistical Department, more than 400 million people are lagging in the digital revolution of India. Some villages do not have electricity in India which is one of the biggest challenges India faces. But with new budgets, India is heavily investing in producing and providing every household in India with electricity by 2019. Another challenge which India is facing is high poverty rate, about 273 million people in India have a daily earning of $1.25. This limits them to 2 meals a day, which is a harsh reality India is living in. The Government has come up with policies like “‘Grain for Work” which is providing millions of villagers with employment opportunities. The new budget of India has allocated Rs. 57,600 crores towards agriculture and development which is a 15% increase from the previous year. In the drive for a cashless economy, the government must first provide cash to all its citizens. This process is indeed complex, but a modest step towards the improvement of the society would lead to a new India in the long term. A cashless economy is no longer a term in India but is becoming a reality to the country. With the government working day in and day out to develop the country’s standards, progress is definitely visible. Digital India, which was only a word in the Prime Minister’s speech a few years back has already seen its implementation. People are no longer relying on physical currency, as they are now getting used to the modern e-wallets. Wi-Fi hotspots are now seen in every corner of Indian cities, and free hotspot zones are found in every Railway Stations in India. A few years back people would never dream of such comfort, but now India is transitioning to a digital age. Banks have completely revolutionized in a decade’s period. ATMs and deposit machines have made it convenient for people to make transactions and deposits. Earlier in pre digitalization era, people had to wait in queues for hours to conduct transactions. This has increased the customer base for banks in India, as people observe it more convenient to interact with machines, which are more straightforward. The bank went through another massive change when the policy of demonetization was implemented. This was the nail in the coffin for the Digital India initiative. The dependence on physical cash was dropped after the implementation of the policy. Credit cards, Debit cards, and E-wallets became the new source of a transaction in India. Demonetization is not a perfect policy as it saw India’s GDP fall down, but along with few negatives, this policy, in the long run, would be the sole reason for the cashless economy in India. The dependence on the internet indeed leads to increase in cybercrime in India, as the internet and cybercrime as positively correlated. But the Government of India is not letting its dream prevail in the hands of cybercrime, as it has heavily invested in providing secure and safe networks for its citizens. Several policies to safeguard internet in India have been undertaken by the government. These policies are working day in and day out to provide a secure network, especially after an increase in reliance on the internet. To conclude, India’s cashless economy is increasingly becoming popular. The government is doing its best to earn the trust of its citizens as it is focused on its goals. The government has implemented many policies which ensure the safety of its citizens while using the internet. With the rapid growth of technology, newer threats are being created and fixed every moment. The government of India does not look at it as an obstruction, in fact, it is working regularly to prevent cyber-attacks and make the internet safe and secure for its citizens. A cashless economy is not the future, but it is the present.

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