The number of frauds in the banking sector went up to 13,530 in 2022-23 year-on-year, but the amount involved nearly halved at Rs 30,252 crore, showed a Reserve Bank data released on Tuesday.
Frauds occurred predominantly in the category of digital payments (card/internet), in terms of number, said Reserve Bank's Annual Report 2022-23.
However, in terms of value, frauds have been reported primarily in the loan portfolio (advances category).
A total of 9,097 frauds had taken place in 2021-22 involving Rs 59,819 crore. In 2020-21, the number of frauds was 7,338 and amount involved was Rs 1,32,389 crore.
"An assessment of bank group-wise fraud cases over the last three years indicates that while private sector banks reported maximum number of frauds, public sector banks continued to contribute maximum to the fraud amount during 2022-23," the report said.
Data are in respect of frauds of Rs 1 lakh and above reported during the three years.
The report said there was a 55 per cent decline in the amount involved in the total frauds reported during 2021-22 over 2020-21.
Further, proportionately, the decline in the total amount involved in frauds continued during 2022-23, with a reduction of 49 per cent over 2021-22.
"While small value card/internet frauds contributed maximum to the number of frauds reported by the private sector banks, the frauds in public sector banks were mainly in loan portfolio," the RBI said.
It said frauds reported in a year could have occurred several years prior to the year of reporting.
The central bank also said an analysis of the vintage of frauds reported during 2021-22 and 2022-23 shows a significant time-lag between the date of occurrence of a fraud and its detection.
The amount involved in frauds that occurred in previous financial years formed 93.7 per cent of the frauds reported in 2021-22 in terms of value.
Similarly, 94.5 per cent of the frauds reported in 2022-23 by value occurred in previous financial years.
During 2022-23, while public sector banks reported 3,405 frauds involving Rs 21,125 crore, private banks reported 8,932 cases involving Rs 8,727 crore. The rest were from foreign banks, financial institutions, small finance banks, and payment banks.
As per the data, 95 per cent or Rs 28,792 crore of the total Rs 30,252 crore was reported in cases related to loans (advances).
The central bank said amounts involved reported do not reflect the amount of loss incurred. Depending on recoveries, the loss incurred gets reduced. Further, the entire amount involved is not necessarily diverted.
The RBI said it would be taking more steps to check fraud in the banking sector.