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Introduction
Financial frauds in public and private banks not only impact the growth and progress of the
banking sector but also adversely impact the economic conditions of the entire country. The
banking sector is considered as the core industry of the economy that provides robustness
to the country and determines its production and consumption activities. When the banking
sector is hit by financial frauds, it adversely impacts the bank’s performance and its produc-
tivity (Khanna and Arora, 2009). The current research assesses financial fraud in India by
considering the perception and emerging issues of both private and public sector banks.
The Indian banking system has been facing various issues viz., financial reporting frauds,
non-performing assets, credit card debts, cyber frauds, identity theft fraud, and misappropria-
tion of assets (tangible and intangible) that adversely impact its productivity and performance
levels.
As per the recent statistics released by the Reserve Bank of India, scheduled commercial
banks and select Financial Institutions have reported 84,545 incidents of fraud involving a
total amount of Rs 1.85 lakh crore during 2019-20, out of which more than 85% of frauds
have been recorded in the public sector banks in the form of misappropriating share and 65%
to 75% loss in the form of business share (credit and deposit loss).
Academia Letters, July 2021 ©2021 by the authors — Open Access — Distributed under CC BY 4.0
Academia Letters, July 2021 ©2021 by the authors — Open Access — Distributed under CC BY 4.0
Conclusion
The research is expected to provide a comprehensive overview of the emerging issues of both
private and public banks in India concerning financial frauds. The facts related to financial
frauds within the Indian banking sector have been limited and did not provide much informa-
tion about the challenges that are faced by them. The research also contributes towards the
enhancement of the functioning of banks by directing the attention of policymakers towards
making stringent rules against fraudsters.
Academia Letters, July 2021 ©2021 by the authors — Open Access — Distributed under CC BY 4.0
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Academia Letters, July 2021 ©2021 by the authors — Open Access — Distributed under CC BY 4.0
Academia Letters, July 2021 ©2021 by the authors — Open Access — Distributed under CC BY 4.0