RBI plans to establish a fraud register to prevent bank fraud

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RBI plans to establish a fraud register to prevent bank fraud

New Delhi: The Reserve Bank of India (RBI) is considering the creation of a fraud register which would have a database of fraudulent websites, telephones as well as different modi operandi for digital fraud. With this, the central bank aims to prevent fraudsters from using the banking infrastructure.
The RBI is in talks with different stakeholders and implementing agencies for the implementation of the same. “We talk to different stakeholders, including different departments like payments and settlement and supervision of RBI,” its chief executive Anil Kumar Sharma told Economic Times.

He added that such a database will help these scammers not to repeat the fraud as websites or phone numbers would be blacklisted. In many cases, users open accounts at another bank after committing fraud at one bank, Sharma pointed out.

India’s banking sector saw a 50% drop in fraud cases in fiscal year 2022 to 2,369 from 4,680 in the previous fiscal year, parliament informed in July during the monsoon session. The amount involved in frauds also decreased to Rs 3,204 crore from Rs 7,306 crore in 2020-21.

There is not yet a specific timeline for the establishment of the fraud register, however, participants in the payment system will have access to this register for near real-time fraud monitoring. In addition, collected fraud data will be published to inform customers about emerging risks.

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RBI Chief Executive Sharma also said Core Investment Company clients would fall under the Reserve Bank’s Integrated Mediation Scheme 2021, which was launched with effect from September 1 last year.

In FY22, no less than 418,000 complaints were received under this program, of which 97.9% were resolved.

The majority of complaints (39%) related to issues with debit/ATM cards, mobile and electronic banking, and credit cards, while issues with bank loans and advances made up the second largest chunk with 28%.

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