Advance-Fee Scams via UPI
How lottery, prize, and government-scheme fraudsters in India exploit UPI's simplicity to collect processing fees from victims.
Part of: Advance Fee Scams
Last reviewed: 1 June 2026
Advance-fee fraud has adapted to India's digital payment infrastructure with UPI as the primary collection rail. Fraudsters impersonate government ministries, RBI officials, or prize companies to inform victims they are entitled to a cash windfall that requires a UPI payment to process. The simplicity of UPI — anyone can send money with a phone number or VPA — makes it trivially easy for victims to comply before seeking a second opinion.
The RBI and NPCI have repeatedly clarified that no government body collects fees via UPI, but the scam persists because new victims are unfamiliar with this guidance.
How this scam works on UPI
Victims receive an SMS, WhatsApp message, or call claiming they have been selected for a government housing scheme, a cashback lottery, or an insurance maturity payment. A small UPI payment — framed as a 'processing fee', 'GST charge', or 'account verification debit' — is required before the larger sum can be credited. The UPI collect request or VPA is provided immediately.
After the first payment, a new condition appears: a 'clearance fee', a 'foreign exchange conversion', or a 'last verification payment'. The promised government credit never materialises.
Common red flags
- UPI request or VPA from an unknown contact claiming to represent a government scheme or RBI
- Prize or benefit notification you did not apply for or register for
- Any processing fee required via UPI before a government payment can be received
- Urgency framing: 'Offer expires today' or 'Slot allocated to you will be transferred to next applicant'
- UPI collect request arriving immediately after or during a suspicious call
- Caller warns against telling family or a bank representative about the transaction
How to protect yourself
- No Indian government scheme collects fees via UPI — this is an absolute red flag
- Verify any government benefit at the relevant ministry's official website or a Jan Seva Kendra
- Never approve an incoming UPI collect request from an unknown source
- Report the UPI VPA used to cybercrime.gov.in before the fraud amount is lost
- Discuss any surprising windfall notification with a trusted family member before taking action
How to report it
- Report to the National Cybercrime Reporting Portal at cybercrime.gov.in or call 1930
- Raise a dispute with your bank through the UPI app immediately with the VPA and transaction reference
- Report the mobile number used for the call to TRAI's DND registry as a suspected fraud number
Frequently asked questions
Are PM-KISAN or Ayushman Bharat payments ever processed via UPI with a fee?
No. Government benefit payments under schemes such as PM-KISAN, PMJDY, or Ayushman Bharat are credited directly to a registered bank account through DBT (Direct Benefit Transfer). The government never contacts beneficiaries to collect fees via UPI, WhatsApp, or phone. If someone claims otherwise, it is fraud.