RBI to assess large value frauds to identify reporting delays

Mumbai: The Reserve Bank of India (RBI) is set to conduct a study on afew large instances of fraud to pinpoint the reasons behind the delay in identifying them. The regulator is also engaged in interlinking various databases and information systems to improve fraud monitoring and detection.

“A study on the large-value frauds with the involvement of select banks, NBFCs, urban-cooperative banks and domain experts will be undertaken for recognising the causes for delay in identifying frauds by supervised entities and suggest measures for early detection and timely mitigation of the risks arising out of frauds,” the RBI said in its annual report.

As per the latest data available with the RBI, the total cases of frauds (involving `1lakh and above) reported by banks and financial institutions increased by 28% in volume and 159% by value during 2019-20.


These instances are, however, spread over several years, the regulator noted. Private banks reported frauds worth Rs 34,211crore. At the end of March 2020, banks had reported frauds worth Rs 1.85 lakh crore involving 8,707 cases.

About 80% of this or Rs 1.48 lakh crore was reported by state-run banks.

“Frauds have been predominantly occurring in the loan portfolio (advances category), both in terms of number and value,” the regulator said. “There was a concentration of large-value frauds, with the top 50 credit-related frauds constituting 76% of the total amount reported as frauds during 2019-20.”