India’s rapidly evolving fintech industry, driven by digital innovation and government support, has concurrently witnessed a rise in digital financial fraud, underscoring the critical need for enhanced e-governance mechanisms and financial literacy. This study examines the increasing incidence of digital financial fraud within India’s expanding fintech sector, with a particular focus on the role of financial literacy and e-governance in addressing these security challenges. This study proposes an integrative framework that synergises e-governance, financial literacy, and advanced cybersecurity protocols to strengthen consumer protection and foster trust within the digital finance ecosystem. By embedding advanced fraud prevention technologies within regulatory mechanisms and prioritising targeted financial literacy initiatives across diverse demographics, the proposed model offers a proactive and holistic approach to mitigating digital financial risks. Such a strategy not only empowers consumers with the essential knowledge to navigate digital transactions securely but also supports sustainable sectoral growth.