India's digital payments ecosystem has seen an unprecedented boom in recent years — from UPI transactions hitting record highs to mobile wallets becoming ubiquitous. But alongside this surge in convenience and scale comes an equally critical need: fraud prevention.
In 2025, we're seeing a strategic shift where payment aggregators are no longer just platforms to facilitate transactions — they're becoming infrastructure providers, equipping banks and financial institutions with advanced anti-fraud software solutions.
What's Happening?
Merchant-focused payment firms like Razorpay, PayU, and PhonePe are going all-in on their fraud detection tech stacks. These companies are now productizing their internal fraud-fighting tools and offering them to banks and NBFCs as SaaS solutions.
“It is an authentication engine that enhances transaction success rates while ensuring robust security — helping businesses prevent fraud and offer a secured payment experience.”
— Arif Khan, Chief Innovation Officer, Razorpay
This means that the same advanced systems designed to spot anomalies, flag unnatural payment patterns, and validate user behavior are now being shared across the broader financial ecosystem — multiplying their impact.
Why It Matters for the Tech Industry
This move reflects a broader trend in the tech-meets-finance space:
SaaSification of Fintech
Companies are shifting from being pure service providers to tech product companies, creating recurring revenue streams through software licensing.
Rise of API-first Platforms
Modular anti-fraud systems built as APIs allow easy integration with bank infrastructure — a developer-friendly future.
Regulation as Innovation Catalyst
With stricter compliance norms from RBI and the government, innovation isn't optional — it's mission-critical.
AI and Behavioral Analytics
From static rules to adaptive machine learning models, these tools represent the cutting edge of applied AI in real-world scenarios.
How Businesses Stand to Gain
For payment companies, this evolution means:
New revenue streams via SaaS models
Better compliance and reduced risk
Enhanced customer trust through secure experiences
For banks and financial institutions:
Faster, smarter fraud detection without building in-house solutions
Higher transaction success rates
Reduced operational load on compliance and risk teams
And for consumers?
Peace of mind.
The DPI Factor: Public Infrastructure, Private Innovation
As Monica Jasuja of the Emerging Payments Association Asia noted, India's Digital Public Infrastructure (DPI) like UPI and Aadhaar lays the groundwork. But the real value lies in what's built on top of it.
“India is unique because public infrastructure via DPIs provides the foundational layer, but the real differentiation that will make payment companies stand out and generate sustainable revenue lies in value-added services built on top.”
This is the sweet spot — where public infrastructure meets private innovation — and anti-fraud tech is fast becoming the next competitive differentiator.
What's Next?
As the race for secure, scalable, and intelligent digital finance continues, expect to see:
- Wider adoption of real-time behavioral fraud analytics
- Partnerships between payment companies and cybersecurity startups
- Expansion of fraud prevention to offline commerce and cross-border payments
At Datvolt, we're inspired by how anti-fraud innovations are reshaping the fintech landscape in India. This is more than a technological shift — it's a mindset transformation that prioritizes trust, intelligence, and resilience in every transaction.
At Datvolt we believe the future of payments isn't just about speed — it's about security at scale. And we're excited to build and collaborate in this next phase of financial evolution.