Banks wary of spiraling frauds
Banking, financial institutions struggling to deal with increasing defaults and cheating incidents: Deloitte
image for illustrative purpose
Other Top-5 Concerns
- Data theft
- Cybercrime
- Third-party-induced fraud
- Bribery and corruption
- Fraudulent documentation
New Delhi: In the wake of Covid-19 and new digital operations, banking and financial institutions have been struggling to deal with an increasing number of fraud incidents and the trend is expected to continue, a Deloitte India survey said on Monday.
Key reasons identified for the increase in fraud incidents over the next two years include large-scale remote working models, increase in customers using non-branch banking channels and the limited/ineffective use of forensic analytics tools to identify potential red flags, Deloitte Touche Tohmatsu India LLP (DTTL) said in a release.
About the survey, Deloitte said it gathered the views of 70 key C-suite stakeholders/ senior management responsible for compliance and fraud risk management, audit/ finance, asset recovery from varied financial institutions based in India. Banks and financial institutions which participated in the survey included private, public, foreign, co-operative and regional rural banks in India.
"In the wake of Covid-19 and new digital operations, banking and financial institutions have been struggling to deal with an increasing number of fraud incidents," the Deloitte India Banking Fraud Survey said, adding "this trend is expected to continue, with 78 per cent respondents stating that frauds could increase over the next two years."
As per the survey findings, retail banking was identified as a major contributor to fraud incidents, with 53 per cent of respondents indicating that they had experienced more than 100 fraud incidents (over the last two years) - a 29 per cent rise since the previous edition. Similarly, the non-retail segment saw an average of 20 fraud incidents, highlighted by 56 per cent of survey respondents - again, a 22 per cent rise.
"Additionally, data theft, cybercrime, third-party-induced fraud, bribery and corruption, and fraudulent documentation have been identified as the top five concerns with over 42 per cent of respondents (cumulative) reporting to be victims of these," the release said.
