The Reserve Bank of India’s latest annual report has shown a sharp shift in the pattern of banking frauds, with the number of reported cases falling significantly in FY26 even as the total amount involved rose to ₹48,021 crore, the highest level recorded in the last three years.
According to the report, banks reported frauds worth ₹48,021 crore in FY26, compared to ₹32,803 crore in FY25, marking a rise of nearly 46.4 percent. The increase came despite a steep decline in the number of fraud cases, indicating that fewer but larger frauds are now posing a greater challenge to the banking system.
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Fraud Cases Fall, But Value Rises Sharply
RBI data showed that 10,114 fraud cases were reported in FY26, down from 23,722 cases in FY25, a decline of around 57.4 percent. Compared to FY24, the number of cases has fallen by more than 71 percent.
However, the total fraud amount has risen sharply over the same period. In FY24, the amount involved in bank frauds stood at ₹11,013 crore. By FY26, it had increased more than fourfold to ₹48,021 crore.
The central bank noted that both public-sector and private-sector banks reported fewer fraud cases, but the value of frauds rose steadily. The report showed that the highest losses came from the advances category, which includes loans and credit facilities.
Public-Sector Banks Account for Largest Share
Public-sector banks were the worst affected in terms of fraud value. State-owned banks reported frauds worth ₹35,709 crore in FY26, up from ₹23,617 crore in FY25 and ₹8,092 crore in FY24.
Public-sector banks accounted for 74.5 percent of the total fraud amount reported during FY26. At the same time, the number of fraud cases in these banks declined to 5,418 in FY26 from 6,916 in FY25.
Private-sector banks reported frauds worth ₹11,399 crore in FY26, an increase of nearly 28 percent over the previous year. Their share in the total fraud amount stood at 23.7 percent.
Loan Frauds Emerge as Major Concern
The report highlighted that frauds involving loans and advances are becoming the biggest concern for the banking sector. Banks reported 8,640 fraud cases under the advances category in FY26, compared to 7,924 cases in FY25.
The total amount involved in advances-related frauds stood at ₹40,774 crore, accounting for nearly 85 percent of the total fraud amount reported during the year.
In contrast, frauds involving cards, internet banking and digital payments declined sharply. Only 293 digital payment fraud cases were reported in FY26, compared to 13,332 in FY25 and 28,836 in FY24. The amount involved in such frauds fell from ₹1,452 crore in FY24 to ₹29 crore in FY26.
Experts believe stronger digital security systems and real-time monitoring have helped reduce smaller online frauds. However, the RBI data suggests that high-value loan frauds, fake documentation and organised financial scams remain a serious threat to India’s banking ecosystem.
