A day after revealing that MobiKwik was the victim of a fraud in Haryana totaling about Rs 40 crore, the fintech company clarified that the incident was caused by a "isolated technical issue" rather than a cybersecurity breach.
Key Highlights
- A software glitch allowed unauthorized payouts worth about ₹40 crore, despite insufficient balances and wrong PINs.
- 2,500 bank accounts frozen, six arrested; company recovered ~₹14 crore, with ~₹26 crore loss net.
Earlier this week, the company initially informed the stock exchange (NSE) about the fraud. MobiKwik updated its explanation on the exchange platform and issued an official press release on Thursday.
The company claims that the glitch happened between September 11 and 12, when some unsuccessful transactions were mistakenly reported as successful. As a result, some merchants in and around the Nuh district of Haryana received unauthorized payouts. According to reports, some users and merchants took advantage of the mistake to make disproportionately large profits.
According to MobiKwik, the problem was identified and resolved in the wee hours of September 12 in less than 45 minutes. More than 2,000 merchant bank accounts have been frozen, a FIR has been filed, and arrests have been made. The business also stated that some of the money has already been recovered and that recovery efforts are still ongoing.
Also Read: MobiKwik Faces Rs 40 Crore Loss in Just 48 Hours
Crucially, the business stressed that the issue had no bearing on bank accounts, legitimate merchants, customer balances, or UPI or wallet payments. The company stated, "This was a limited internal processing error, now fully addressed, rather than a cybersecurity breach."
It is important to clarify that this incident did not impact any UPI or Wallet payments, or user account balances. Also, no legitimate user or merchant suffered any financial loss, and no customer data or credentials were compromised. This was not a cybersecurity breach but a limited internal processing error, now fully addressed. As this was an internal issue, no banks or financial institutions were affected. MobiKwik has strengthened its monitoring systems and implemented additional control measures. We would like to reassure everyone that MobiKwik app is 100% safe and secure for all digital payments.
