Reserve Bank unveils ‘bank.in’ domain and extends Additional Factor Authentication for international transactions, aiming to curb rising digital fraud concerns in India’s financial sector
In a significant move to strengthen digital banking security, the Reserve Bank of India (RBI) announced on Friday the introduction of a dedicated ‘bank.in’ domain for Indian banks, alongside enhanced authentication measures for international transactions. The initiative, set to launch in April, marks a crucial step in the central bank’s ongoing efforts to combat digital fraud and secure online banking services.
RBI Governor Sanjay Malhotra revealed that the exclusive domain would be followed by ‘fin.in‘ for the broader financial sector, creating a more secure digital environment for banking operations. This development comes as Tamil Nadu’s fintech startups experience rapid growth, with Chennai emerging as a significant hub for financial technology innovation.
The central bank’s decision to extend Additional Factor Authentication (AFA) to international online payments represents a major shift in cross-border transaction security. This measure will specifically apply to offshore merchants who have the technical capability to implement such authentication protocols, potentially affecting numerous e-commerce and digital service providers.
“The RBI has been implementing various initiatives to strengthen digital security in the banking and payments systems, with AFA for domestic payments being one of them,” explained Governor Malhotra. He emphasized the delicate balance between user convenience and security in an increasingly digital financial landscape.
K. Rajaraman, CEO of Chennai-based cybersecurity startup SecureFinTech, welcomes the move: “This initiative creates significant opportunities for Tamil Nadu’s cybersecurity startups. We’re seeing increased interest from banks looking to implement robust security solutions that align with these new requirements.”
According to recent data from the Tamil Nadu Startup and Innovation Mission (TANSIM), the state has witnessed a 45% increase in fintech startups over the past year, with 30% focusing on banking security solutions. The new RBI guidelines are expected to create additional opportunities for these startups to develop specialized security products and services.
The implementation of the ‘bank.in’ domain is particularly relevant for Tamil Nadu’s banking sector, which hosts operations of major public and private banks. Industry experts estimate that approximately 70% of banks in the state will need to upgrade their digital infrastructure to comply with the new requirements, creating opportunities for local technology providers.
Dr. Vijayalakshmi Subramanian, Director of the Digital Banking Research Center at IIT Madras, notes: “The RBI’s move aligns with global best practices in digital banking security. Tamil Nadu’s strong IT infrastructure and skilled workforce position us uniquely to support banks in this transition.”
For the state’s startup ecosystem, the RBI’s announcement presents both challenges and opportunities. While established fintech companies will need to adapt their payment gateways to accommodate the new authentication requirements, it also opens doors for innovative solutions in fraud prevention and secure payment processing.
The central bank has emphasized that banks and NBFCs must develop and regularly test robust incident response and recovery plans. This requirement is expected to boost demand for cybersecurity services and create new partnerships between financial institutions and technology providers in Tamil Nadu’s startup ecosystem.
