The Indian banking sector has seen a significant increase in the value of money involved in fraud cases. According to the annual report of the Reserve Bank of India (RBI), the amount involved in bank fraud increased by 46 percent to ₹48,021 crore in the financial year 2025-26. Last year, this figure was ₹32,803 crore. However, one good thing is that the actual number of fraud cases has come down.
Fraud cases reduced, but value of money increased
According to the RBI report, a total of 10,114 fraud cases were reported in 2025-26, while the number was 23,722 a year ago. This means that despite the decline in the number of cases, there has been an increase in high-value frauds. The report shows that the value of fraud in public sector banks has reached ₹35,709 crore, which is more than ₹23,617 crore last year. At the same time, in private sector banks this figure increased from ₹ 8,927 crore to ₹ 11,399 crore.
previous cases reported
RBI said this year’s figures also include 314 cases totaling ₹30,199 crore. These cases were from previous financial years, but were reported after re-examination based on the Supreme Court decision on March 27, 2023. According to RBI, cases of fraud often happen early, but they are detected later. As a result, the year in which a case is reported is not necessarily the same year in which the fraud actually occurred.
Loan fraud is highest
According to the report, the highest number of fraud cases were seen in the bank loan category – especially the ‘advances’ category. During this period, fraud worth ₹40,774 crore was detected in 8,640 cases. Last year, this figure was ₹30,367 crore. Experts believe that big corporate loans and fraud using fake documents are the biggest challenges for the banking system.
Reduction in digital payment fraud
There has been an increase in incidents of major banking frauds, but there has been a significant decline in frauds related to card and digital payments. In 2025-26, the total amount involved in such cases was just ₹29 crore, compared to ₹517 crore last year. The number of such cases has also reduced from 13,332 to only 293. RBI attributes this reduction to increased digital security measures and better monitoring.
‘Kill Switch’ system coming soon
To combat digital fraud, the Reserve Bank of India (RBI) is currently working on introducing a ‘kill switch’ facility. Through this system, customers will be able to immediately stop all transactions from their bank accounts in case of any emergency. Additionally, RBI plans to further strengthen the ‘Switch On/Off’ feature, which will enable customers to have greater control over their card and digital payment activities.
Emphasis on cyber security
RBI has also taken the initiative to launch a secure domain named ‘.bank.in’. With this move, India has become the first country in the world to implement such a measure. It is expected that this initiative will strengthen cyber security and play an important role in preventing online banking fraud.
