Public sector bank loan frauds: A 10% problem, but a 98% financial crisis

The finance ministry's ongoing efforts aim to strengthen fraud detection, improve the speed of investigations, and ensure accountability across the banking sector

Public sector banks (PSBs) in India are grappling with a growing number of fraud cases, with borrowal account frauds comprising only 10 per cent of the total number of fraud cases but accounting for a massive 98 per cent of the total fraud value from April 2020 to September 2024, according to senior government official sources.

 

Borrowal fraud in banks, also called loan fraud, refers to any deceitful act where an individual or entity intentionally provides false information to obtain a loan or credit, often by manipulating their income, assets, or employment details to deceive a lender and secure funds