Amount involved in fresh bank frauds drops 56% in 2020-21

The number of fresh bank frauds as well as the amount involved in them saw a drastic fall in 2020-21, according to the Reserve Bank of India’s latest report on Trend and Progress of Banking in India 2020-21.

The amount involved in the new bank frauds committed in 2020-21 fell 56% to Rs 14,158 crore as against Rs 32,290 crore in 2019-20. The number of frauds also fell from 5,359 in 2019-20 to 4209.

The amount involved in frauds based on date of reporting also fell to Rs 1.38 lakh crore in 2020-21 from Rs 1.85 lakh crore in the previous year. Frauds reported in a year could have occurred several years prior to year of reporting.

Amounts involved are as reported and do not reflect the amount of loss incurred. Depending on recoveries, the loss incurred gets reduced. Further, the entire amount involved in loan accounts is not necessarily diverted.

Majority of frauds were committed were in relations to loans given by the banks. For example, of the total amount of Rs 1.38 lakh fraud reported in 200-21, 1.37 lakh crore was due to loan related frauds.

The number of bank frauds related to cards and internet transaction accounted for 35% of the total cases even if the amount involved was a paltry Rs 119 crore.

In 2020-21, there was a marked increase in frauds related to private banks, both in terms of number as well as the amount involved. In the first half of 2021-22, private banks accounted for more than half of the number of reported fraud cases. However, the share of PSBs was higher, indicating predominance of high value frauds. While the major share of loans related cases pertained to PSBs, private banks accounted for a majority of card/ internet and cash-related cases.

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