What is UPI ID Spoofing Merchant Scam?

Dangerous: UPI ID Spoofing Merchant Scam is a confirmed scam in India. Beware of UPI ID spoofing merchant scams in India. Learn how fraudsters create fake merchant IDs to steal money and protect yourself from UPI fraud.

How does UPI ID Spoofing Merchant Scam work?

Step 1: Scammers create fake UPI IDs mimicking legitimate merchants using variations like 'merchantname@paytm' or 'merchnt@phonepe' with publicly available phone numbers Step 2: They send multiple fake 'collect money' requests through UPI apps for small amounts like refunds, cashback, or overpayments to make them seem legitimate Step 3: Victims receive calls or SMS impersonating bank representatives or customer service, urging immediate approval to 'claim refund' or 'complete verification' Step 4: Rushed victims approve the request thinking it's legitimate, causing direct money deduction from their account to the scammer's account Step 5: If successful, scammers escalate with larger amount requests or ask for screen-sharing app access before disappearing

How to protect yourself from UPI ID Spoofing Merchant Scam?

Verify the merchant’s UPI ID independently through official websites or trusted customer service before approving any payment requests. Reject any unsolicited UPI payment or refund requests from unknown or suspicious IDs. Avoid responding to calls or messages claiming urgent refunds or cashback from merchants you have not recently transacted with. Report suspicious UPI IDs and payment requests immediately to your bank’s customer care and National Payments Corporation of India (NPCI).

UPI ID Spoofing Merchant Scam

यूपीआई आईडी स्पूफिंग मर्चेंट घोटाला

INDIA — By BharatSecure Threat Intelligence Team · Updated Apr 20, 2026

Verdict: Dangerous | Risk Score: 9/10 | Severity: MEDIUM

Category: UPI

How UPI ID Spoofing Merchant Scam Works

Step 1: Scammers create fake UPI IDs mimicking legitimate merchants using variations like 'merchantname@paytm' or 'merchnt@phonepe' with publicly available phone numbers
Step 2: They send multiple fake 'collect money' requests through UPI apps for small amounts like refunds, cashback, or overpayments to make them seem legitimate
Step 3: Victims receive calls or SMS impersonating bank representatives or customer service, urging immediate approval to 'claim refund' or 'complete verification'
Step 4: Rushed victims approve the request thinking it's legitimate, causing direct money deduction from their account to the scammer's account
Step 5: If successful, scammers escalate with larger amount requests or ask for screen-sharing app access before disappearing

How This Scam Works — Detailed Explanation

UPI ID Spoofing Merchant Scam is a sophisticated fraud targeting Indian mobile banking and payment users. Scammers create fake merchant UPI IDs that look nearly identical to trusted brands or stores you may have shopped at before. These fake IDs might differ by a single character or a small typo but appear extremely convincing on phone screens and app interfaces. Using these spoofed IDs, fraudsters try to trick victims into approving payments or refunds on apps like BHIM, Google Pay, PhonePe, or Paytm.

The scam usually starts with an unsolicited message or WhatsApp call claiming you have a pending refund, cashback, or discount from a merchant you don’t remember transacting with recently. Scammers use this angle to build trust and urgency by pushing you to approve a UPI payment request immediately, warning that the offer or refund will get canceled otherwise. They may also pressure victims to approve multiple requests within a short span, often with similar-looking merchant IDs, to confuse and overwhelm them.

Once the victim approves payment requests, the money gets transferred instantly to the scammer’s account without usual chances of reversal. Because UPI payments are instant and don’t require OTP sharing, victims might not realize until much later that their account balance is drained. Scammers exploit India's vast Aadhaar-linked bank accounts and the popularity of UPI to launch these attacks at scale. Many victims report receiving repeated calls and messages pretending to be from bank representatives or merchant customer care, adding a false layer of credibility.

Victims often suffer significant financial losses and face delays in recovering money due to procedural challenges in banking complaints. With increasing digital transactions in India, especially post-pandemic, such UPI ID spoofing merchant scams are becoming alarmingly common. Awareness and vigilance are crucial to avoid falling prey to these fraudsters who leverage familiar payment platforms Indians use daily for bill payments, shopping, and money transfers.

Who Does UPI ID Spoofing Merchant Scam Target?

Middle-aged to elderly Indians (40+), small merchants, shopkeepers, petrol pump attendants, gig workers, and less tech-savvy UPI users in urban and semi-urban areas

Red Flags — How to Identify UPI ID Spoofing Merchant Scam

Unknown or suspicious UPI ID requesting money that resembles legitimate merchants
Unsolicited calls claiming pending refunds or cashback from merchants you haven't transacted with
Urgent pressure to approve UPI requests immediately to avoid cancellation
Collect requests for refunds when you haven't made any recent purchases or overpayments
Multiple repeated money collection requests from similar looking merchant IDs

What To Do If You Encounter UPI ID Spoofing Merchant Scam

Verify the merchant’s UPI ID independently through official websites or trusted customer service before approving any payment requests.
Reject any unsolicited UPI payment or refund requests from unknown or suspicious IDs.
Avoid responding to calls or messages claiming urgent refunds or cashback from merchants you have not recently transacted with.
Report suspicious UPI IDs and payment requests immediately to your bank’s customer care and National Payments Corporation of India (NPCI).
Monitor your bank account and UPI transaction history regularly and report unauthorized transactions to your bank without delay.

How to Report UPI ID Spoofing Merchant Scam in India

Call 1930 — National Cyber Crime Helpline (24x7)
File a complaint at cybercrime.gov.in
Contact your bank immediately if money was lost
Call RBI helpline: 14440 for banking fraud

Frequently Asked Questions

What is UPI ID Spoofing Merchant Scam?: Dangerous: UPI ID Spoofing Merchant Scam is a confirmed scam in India. Beware of UPI ID spoofing merchant scams in India. Learn how fraudsters create fake merchant IDs to steal money and protect yourself from UPI fraud.
How does UPI ID Spoofing Merchant Scam work?: Step 1: Scammers create fake UPI IDs mimicking legitimate merchants using variations like 'merchantname@paytm' or 'merchnt@phonepe' with publicly available phone numbers Step 2: They send multiple fake 'collect money' requests through UPI apps for small amounts like refunds, cashback, or overpayments to make them seem legitimate Step 3: Victims receive calls or SMS impersonating bank representatives or customer service, urging immediate approval to 'claim refund' or 'complete verification' Step 4: Rushed victims approve the request thinking it's legitimate, causing direct money deduction from their account to the scammer's account Step 5: If successful, scammers escalate with larger amount requests or ask for screen-sharing app access before disappearing
How to protect yourself from UPI ID Spoofing Merchant Scam?: Verify the merchant’s UPI ID independently through official websites or trusted customer service before approving any payment requests. Reject any unsolicited UPI payment or refund requests from unknown or suspicious IDs. Avoid responding to calls or messages claiming urgent refunds or cashback from merchants you have not recently transacted with. Report suspicious UPI IDs and payment requests immediately to your bank’s customer care and National Payments Corporation of India (NPCI).
How to report UPI ID Spoofing Merchant Scam in India?: Report to cybercrime.gov.in or call 1930 (National Cyber Crime Helpline). You can also contact your local police station's cyber cell.

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