Number of banking frauds go up in FY22; substantially down by value: RBI

Banking frauds increased in number terms but the amount involved more than halved in FY2021-22, the Reserve Bank said on Tuesday.

In FY22, banks reported 9,102 frauds involving an underlying amount of Rs 60,389 crore against 7,358 frauds with an amount involved of Rs 1.37 lakh crore in FY21. Banks reported 8,702 frauds entailing Rs 1.85 lakh crore in the pre-pandemic FY20.

Interestingly, the number of frauds which are related to advances or lending activities has been on a declining trend, with FY22 reporting 1,112 frauds of Rs 6,042 crore, which is lower than 1,477 frauds of Rs 14,973 crore in FY21 and 1,947 frauds of Rs 32,386 crore in FY20, the RBI said in the report on Trend and Progress of Banking in India for FY22.

“in terms of number of frauds, the modus operandi shifted to card or internet-based transactions. Additionally, cash frauds are also on the rise, the report said, adding that this involves frauds of Rs 1 lakh and above reported by banks.

The number of fraud cases reported by private banks outnumbered those by state-run lenders for the second consecutive year in FY22, it said, adding that if compared by amounts involved the public sector banks have a lion’s share at 66.7 per cent which is much higher than the 59.4 per cent in FY21.

In the first half of the ongoing FY23, the system has reported 5,406 frauds involving an underlying amount of Rs 19,485 crore, as compared to 4,069 frauds involving Rs 36,316 crore for the same period in FY21, the report said.

Apart from the frauds reported by the lenders, the report said there were 3.04 lakh complaints registered by aggrieved customers at RBI Ombudsman offices, as against 3.41 lakh in FY21 and 3.06 lakh in FY20.

Automated teller machine or debit cards continued to rule as the biggest area of concern for aggrieved customers, followed by mobile or electronic banking and non-observance of fair practices code.

Nearly three-fourths of the complaints came from urban and metropolitan areas indicating higher awareness levels, it said.

A bulk 98.2 per cent of the complaints by pensioners were filed against state-run lenders, while private banks led with a 46 per cent share in levy of charges without prior notice.

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