The Reserve Bank of India (RBI) has released a draft procedure proposing a temporary freeze on funds or debit transactions in bank accounts suspected of involvement in cyber fraud or illegal activities. The measure is designed to prevent illicit money from being transferred across multiple accounts during investigations into financial crimes. Under the proposed standard operating procedure, if a bank’s transaction monitoring system flags a transfer of 1,000 INR or more as suspicious or linked to "money-mule" operations, the specific funds can be temporarily held. Furthermore, if an entire account is suspected of functioning as a money mule—where account holders intentionally or unknowingly allow their accounts to receive and transfer defrauded funds—a temporary restriction can be placed on all debit transactions, halting withdrawals and outgoing transfers. To protect consumer interests, the draft framework mandates that banks must immediately notify account holders whenever a debit freeze is applied. The notification must outline the reason for the restriction, details of the flagged transactions, and the steps required to lift the freeze. Customers will be given up to 20 days to respond to the notice, while any temporary debit restriction can remain in effect for up to 60 days. The RBI emphasized that these regulations remain in draft form and are open for public consultation. The central bank has set October 2, 2026, as the deadline for submitting feedback, with the proposed guidelines expected to come into effect on April 1, 2027.