Residents with any information have been urged to contact the concerned authority
emergencies8 hours ago
The Reserve Bank of India (RBI) said on Tuesday that it would strengthen its regulatory oversight, identify early warnings, initiate corrective action, and make internal supervision of regulated entities stronger to deal with the challenges posed by Covid-19.
The RBI's move came as bank frauds jumped more than two-fold in the previous fiscal on delayed detection. Bank frauds worth more than Rs1.85 trillion were reported in the year ended June 2020 compared with over Rs715 billion in the previous fiscal, according to the RBI's annual report for 2019-20.
"Frauds have been predominantly occurring in the loan portfolio (advances category), both in terms of number and value. There was a concentration of large value frauds, with the top 50 credit-related frauds constituting 76 per cent of the total amount reported as frauds during 2019-20," the annual report said.
Public sector banks that witnessed a 234 per cent year-on-year rise in fraud cases accounted for 80 per cent of the total such reported instances. Private banks, which reported a more than 500 per cent rise, formed over 18 per cent of the total fraud cases.
The apex bank, stressing the recapitalisation plan for public and private sector banks, said the minimum capital requirements, which are calibrated on the basis of historical loss events, may no longer suffice to absorb post-pandemic losses. RBI added it will tweak its own regulations as supervision functions to deal with the new scenario.
The government spending will support the economy during the pandemic, but private consumption will be needed to drive any economic recovery once the coronavirus threat eases, the RBI said in its annual report.
The RBI also said the banking sector needs to get out of the risk aversion mode and give credit to the productive sector of the economy.
"Turning to the financial sector, Indian banking has to be liberated from the risk aversion that is impeding the flow of credit to the productive sectors of the economy and undermining the role of banks as the principal financial intermediaries in the economy," it said.
issacjohn@khaleejtimes.com
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