Archive · 7 Nov 2025
RBI Deputy Governor Notes Rising Digital Frauds Since July
Imagine your online bank accounts are like digital piggy banks.
The person in charge of banks in India, the RBI Deputy Governor, said that thieves trying to break into these digital piggy banks were caught less often until about July.
After July, more thieves started succeeding.
The reason for this increase is being investigated and could be temporary.
He also mentioned that while the total number of reported frauds went down in the last financial year, digital payment frauds are the most common.
He thinks big banks might not have seen how popular things like UPI (which helps you pay with your phone) would become, while smaller, faster tech companies did.
To stay competitive, these big banks need to update their old computer systems to be more flexible, like the tech companies.
The Deputy Governor also warned that new types of digital money, like private cryptocurrencies and even digital rupees issued by the government, could change the banking business a lot.
RBI Deputy Governor T Rabi Sankar reported a rise in digital fraud incidence since July, following a period of decrease.
The Reserve Bank is investigating the reasons behind the recent increase in digital frauds.
While total frauds decreased in FY25, digital payment frauds (card and internet) remain the most prevalent in number.
Traditional banks are advised to modernize their core IT infrastructure to compete with agile fintech companies.
The rise of private digital currencies and CBDCs poses potentially existential, though not fully understood, risks to banks.
- Who
- RBI Deputy Governor T Rabi Sankar
- What
- Stated that the incidence of digital frauds has been rising since July, and advised banks to modernize core infrastructure to remain competitive against fintechs.
- When
- On Friday, referencing trends up to July and FY25.
- Where
- At an SBI event in Mumbai.
- Why
- To highlight rising digital fraud trends and advise banks on strategic modernization to face competition and evolving digital currency landscapes.
Traditional Banks
Fintechs
Digital Infrastructure and Competitiveness
Traditional Banks
Traditional banks are structurally vulnerable due to monolithic IT systems, high fixed costs from branch networks, and compliance costs. Incremental digitization is unlikely to keep them competitive.
Fintechs
Fintechs were able to realize the potential of UPI due to their agility, suggesting that competitiveness may depend more on data capability and technology flexibility than balance sheet strength.
- Digital Frauds Trend
- Incidence of digital frauds began rising in July after a period of decrease.
- FY25 Fraud Statistics
- Decrease in total frauds to 23,953 from over 36,000 in the preceding year.
- Dominant Fraud Category
- Digital payments (card and internet) in terms of number.
- Bank Fraud Share (Numbers)
- Private sector banks account for nearly 60%.
- Bank Fraud Share (Value)
- PSBs' share is over 71% as of end-FY25.
- RBI's Digital Fraud Tool
- Deploying a 'mule hunter' to track conduit accounts.
- Potential Disruptors
- Risks from private digital currencies and impact of CBDCs on banking business.
