moneyTechnology has become the biggest driver in all financial segments. But it comes with a few flipsides in the form of fraudulent transactions including phishing, spyware and identity theft.With an increase in online transactions, financial institutions -- particularly banks -- are becoming more vulnerable to cyber thefts and online frauds.About 11,997 cases related to ATM, credit and debit cards as well as net banking frauds were reported by banks in 2015-16, according to data by the Reserve Bank of India. These include only the reported cases.A key point to note is obsolescence. An Assocham-PwC report titled “ Protecting interconnected systems in the cyber area ” highlights that online systems are susceptible to cyber attacks because of old technologies having weaker protocol. This makes companies which are stuck in an older order an easy target.People these days prefer online transactions because of the ease and speed. While these help in saving time, online transactions also expose customers and their personal information to fraud.To tackle this, the Reserve Bank of India (RBI) has come out with a proposal to strengthen systems and procedures.A customer’s liability will be zero in cases where the fault lies with the financial institution's electronic system or in case of breach by a third-party, but the fraud has to be reported by the customer within 3 days time.Limited liability will be in cases where the fault, partial or full, lies with the customer. In case a person gives his or her own payment details online, then the loss has to be borne by him unless he reports it to a bank.The circular also states that in case of a transaction, where the fault is neither the bank’s nor the customer's, and if there is a delay in reporting it to the extent of 4-7 days, then customer’s liability will be limited to the transaction value or Rs 5,000, whichever is lower.If the delay in reporting extends beyond 7 days then a decision will be taken as per bank’s board approved policy. Banks will be liable to inform customers about their policies at the time of account opening.In cases when customers report a fraud within time, then the banks will have to credit the amount involved into the cutomer’s account within 10 working days. Case-to-case, the bank can also waive off any liability even if the negligence is on the customer's part.The banks will have 90 days to resolve the entire issue from the date of reporting.“The burden of proving customer liability in case of unauthorised electronic banking transactions shall lie on the bank. The bank’s above policy shall also specify the maximum time period for establishing customer liability after which the bank shall compensate the customer,” mentions RBI.Banks are also expected to put in place a mechanism to report customer’s liability to its committee for review. Banks are expected to review such complaints and any measures taken to solve it on a monthly basis.