New Delhi: High-value fraud cases involving banks and financial institutions have risen sharply again after declining for three consecutive years. According to data presented by the Finance Ministry in Parliament, banks and All India Financial Institutions (AIFIs) reported 5,607 fraud cases involving more than ₹1 crore each between financial year 2020-21 and 2025-26. The cases involved a total of ₹2,31,710.12 crore, while recoveries during the six-year period stood at only ₹6,283.14 crore.
According to the data, the gap between the amount involved in reported frauds and the amount recovered during the period was approximately ₹2,25,426.98 crore. However, the Ministry clarified that the recovery figures represent amounts recovered during the respective periods and should not necessarily be treated as the final losses in the fraud cases.
High-value bank frauds rise 41% in FY26
The sharpest increase was recorded in financial year 2025-26. During the year, banks and financial institutions reported 1,330 fraud cases involving more than ₹1 crore, up around 41% from 941 cases reported in FY25. The amount involved in these cases also rose significantly to ₹46,559.84 crore in FY26.
Recoveries increased during the year as well. Banks and financial institutions recovered ₹2,788.38 crore in FY26, compared with ₹1,287.86 crore in FY25. Despite the increase, the amount recovered remained substantially lower than the total amount involved in the reported fraud cases.
Trend reverses after three consecutive years of decline
The number of high-value fraud cases had declined for three consecutive years after FY21 before the trend reversed. In financial year 2020-21, banks and AIFIs reported 1,066 cases involving ₹97,508.55 crore. Recoveries during the year stood at ₹510.06 crore.
In FY22, the number of cases fell to 889, involving ₹34,126.47 crore, while ₹374.27 crore was recovered. In FY23, the number declined further to 740 cases, involving ₹14,312.78 crore. Recoveries stood at ₹980.09 crore.
The number of cases reached a six-year low in FY24, when banks and financial institutions reported 641 cases involving ₹9,080.50 crore. Of this, ₹342.48 crore was recovered.
The trend then reversed. The number of cases increased to 941 in FY25 before rising further to 1,330 in FY26. This means the number of high-value fraud cases in FY26 was more than double the FY24 level.
₹2.25 lakh crore gap between frauds and recoveries
The Finance Ministry data shows that frauds involving more than ₹1 crore reported between FY21 and FY26 involved a cumulative ₹2,31,710.12 crore. Against this, recoveries during the six-year period amounted to ₹6,283.14 crore.
The difference between the two figures stood at approximately ₹2,25,426.98 crore. However, this gap cannot directly be treated as the final financial loss suffered by banks or financial institutions, as fraud investigations, legal proceedings, attachment of assets and subsequent recoveries may continue beyond the period covered by the data.
FPI activity also reported to Parliament
The Finance Ministry also shared separate data on foreign portfolio investor activity. According to information obtained from the National Securities Depository Limited (NSDL), gross sales by foreign portfolio investors stood at ₹29.8 lakh crore between January 1 and August 5, 2026.
The Ministry clarified that the figure represents gross FPI sales and should not be interpreted as net foreign portfolio investment flows. It therefore does not represent the total amount invested or withdrawn by FPIs during the period.
The sharp rise in high-value fraud cases during FY26 highlights continuing challenges for banks and financial institutions in strengthening monitoring systems, risk management and early detection mechanisms. The data also underscores the significant gap that remains between the value involved in reported frauds and the amount recovered.
About the author — Suvedita Nath is a science student with a growing interest in cybercrime and digital safety. She writes on online activity, cyber threats, and technology-driven risks. Her work focuses on clarity, accuracy, and public awareness.
