RBI Calls For Safeguards Against Computer Frauds

Mumbai, May 20: | Updated: May 21 2003, 05:30am hrs
The Reserve Bank of India (RBI) has urged banks to take adequate safeguards in order to prevent computer frauds. In a recent letter to all commercial banks, the central bank expressed concerns over the computer-security issue and emphasised the need of risk controlling measures.

The RBI letter assumes importance against the background where commercial banks are increasingly relying upon telecommunication and upgrading their existing technologies. At a time when banks, especially the public sector ones, have been rolling out computerised branches and are on a major computerisation drive, the RBI has sent its communique (dated April 19) reiterating the need for taking adequate safety measures.

It has been observed that though major public sector banks are now in a position to claim that over 80 per cent of their businesses are computerised, there is a lack of integrity in computer systems security control at the computerised branches. The need of the hour is to pay attention on physical security control, data security control and process security control.

It is pertinent here to note that the Indian Banks Assocititon working group had recommended these areas for the banks consideration. The group was also in favour of preventive vigilance in computeised branches and had suggested a methodology for sharing of information relating to computer frauds in the banks.

As per the RBI data, about 64 per cent of public sector bank branches is fully or partially computerised. As on end September 2002, the total number of computerised branches is at 46,528 out of which 16,526 branches are partially and 13,078 are fully computersied.