Banking-related scams surged over 2X in H1FY23 from last year: RBI Report

The RBI report highlighted the risks of fraud within the banking sector, including reputation and operational risks. Despite the surge in cases, the total number of reported frauds by banks declined to a six-year low.

Shivangini
First Published28 Dec 2023
As many as 14,483 frauds involving an amount of  <span class='webrupee'>₹</span>2,642 crore were reported in the first half of the current financial year, as compared to 5,396 cases ( <span class='webrupee'>₹</span>17,685 crore) in the same period a year ago. (Image: Jon Krause for WSJ)
As many as 14,483 frauds involving an amount of ₹2,642 crore were reported in the first half of the current financial year, as compared to 5,396 cases ( ₹17,685 crore) in the same period a year ago. (Image: Jon Krause for WSJ)

A recent report from the Reserve Bank of India (RBI) highlighted a significant rise in fraud cases within the banking sector during the initial half of the preceding financial year. The report, titled "Trend and Progress of Banking in India 2022-23," emphasized the critical need to safeguard the banking and payments systems from the growing threats of fraud and data breaches stemming from cyber threats.

As many as 14,483 frauds involving an amount of 2,642 crore were reported in the first half of the current financial year, as compared to 5,396 cases ( 17,685 crore) in the same period a year ago.

Out of the total number of frauds, the card and internet segment surged to 12,069 cases, amounting to 630 crore during H1FY24, compared to 2,321 cases totaling 87 crore in the corresponding period of the previous year, according to the RBI report.

Frauds within the banking sector posed risks to reputation, operations, and overall business, potentially eroding customer trust and carrying implications for financial stability, according to the report.

Despite the surge in fraud cases, the total number of reported frauds by banks in 2022-23 declined to a six-year low. The average amount involved in fraud during this period was noted to be the lowest in a decade. The report indicated a decline in the average amount involved in frauds during 2022-23, with a concentration of cases in card or internet-related frauds.

Also Read | RBI permits lending, borrowing in government securities except T-bills

During 2022-23, the total amount of frauds reported by banks declined to a six-year low, while the average amount involved in frauds was the lowest in a decade, it added.

Also Read | RBI calls for stronger bank balance sheets

Acknowledging the evolving risks faced by the banking system, the report emphasized the importance of building resilience through good governance and robust risk management practices.

 

 

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