Indian banks reported frauds amounting to `13,930 crore in FY24, 47% lower than the previous financial year, the Reserve Bank of India’s (RBI) FY24 annual report said on Thursday. The number of frauds, however, rose from 13,564 in FY23 to 36,075 — a rise of 166%, the report said.
“An assessment of bank group-wise fraud cases over the last three years indicates that while private sector banks reported maximum number of frauds, public sector banks continued to contribute maximum to the fraud amount,” the RBI said.
Frauds have occurred predominantly in the category of digital payments—made from both card and internet banking—in terms of volume. In terms of value, frauds have been reported primarily in the loan portfolio.
While small value card internet frauds contributed maximum to the number of frauds reported by the private sector banks, the frauds in public sector banks were mainly in the loan portfolio. “An analysis of the vintage of frauds reported during 2022-23 and 2023-24 shows a significant time lag between the date of occurrence of a fraud and its detection,” the central bank said.
The amount involved in frauds that occurred in previous financial years formed 94% of the frauds reported in FY23. Similarly, 89% of the frauds reported in FY24 by value occurred in previous financial years.
The RBI said it will set up a cyber range in FY25 to augment cyber incident response capability of banks. It will also augment supervisory capabilities by a suite of supervisory technology data tools on micro-data analytics and other similar use cases using artificial intelligence and machine learning under the Utkarsh 2.0 platform.