Frauds reported jump eight-fold to Rs 21,367 crore; private sector records highest number of cases.
The number of bank frauds witnessed a significant rise in the first half of the current fiscal year to 18,461 cases and the amount involved more than eight-fold to Rs 21,367 crore, according to RBI data released on Thursday.
The Reserve Bank of India has released the Report on Trend and Progress of Banking in India 2023-24, which presents the performance of the banking sector, including commercial banks, co-operative banks and non-banking financial institutions, during 2023-24 and 2024-25 till date.
The report said the number of frauds during April-September, based on the date of reporting of frauds, was 18,461, involving Rs 21,367 crore, as against 14,480 cases involving Rs 2,623 crore in the comparable period of the previous fiscal.
It further said frauds pose multiple challenges to the financial system in the form of reputation risk, operational risk, business risk and erosion of customer confidence with financial stability implications. In 2023-24, the number of fraud cases reported by private sector banks (PVBs) was 67.1% of the total.
However, in terms of the amount involved, public sector banks (PSBs) had the highest share of card and internet frauds, the highest among all bank groups in 2023-24.
India’s strong macroeconomic fundamentals have boosted the performance and soundness of the domestic banking and non-banking financial sectors.
The Report on Trends and Progress of Banking in India 2023-24 said, “Banks’ profitability increased for the sixth consecutive year in 2023-24 and continued to rise in H1:2024-25, with return on assets (RoA) at 1.4% and return on equity (RoE) at 14.6%.”
It added that asset quality has improved, with the gross non-performing asset (GNPA) ratio falling to a 13-year low at 2.7% at end-March 2024 and 2.5% at end-September 2024. Net profit of scheduled commercial banks rose 32.8% to Rs 3,49,603 crore.
RBI sets up panel on ethical use of AI
The Reserve Bank on Thursday announced the formation of an eight-member committee to develop a framework for responsible and ethical enablement of artificial intelligence (FREE-AI) in the financial sector.
Chaired by Professor Pushpak Bhattacharya (Department of Computer Science and Engineering) of IIT Bombay, the panel will assess the current level of adoption of AI in financial services globally as well as in India. It will also review the regulatory and supervisory approach to AI.
