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Of this public sector banks accounted for Rs 35,709 crore in FY 26 as against Rs 23,617 crore last year and private sector Rs 11,399 crore (Rs 8,927 crore), the RBI said. Data pertaining to 2025-26 includes fraud classification in 314 cases amounting to Rs 30,199 crore, pertaining to previous financial years, reported afresh during the current financial year after re-examination and ensuring compliance with the judgement of the Supreme Court, dated March 27, 2023, the RBI said.

Amount involved in advances of banks shot up to Rs 40,774 crore in 8,640 fraud cases as against Rs 30,367 crore (7,924 cases) in the previous year.

“Frauds reported in a year could have occurred several years prior to the year of reporting,” the RBI said.

Interestingly, fraud amount involved in cards and digital payments fell to Rs 29 crore (293 cases) in FY26 against Rs 517 crore (13,332 cases) in FY25 and Rs 1,452 crore (28,836 cases) in FY24, RBI said.

“An assessment of bank group-wise fraud cases over the last three years indicates that although the number of frauds for public and private sectors banks have reduced, the amount involved has increased over the years,” the RBI report said. While number of frauds was highest under card internet/ digital payments category during 2023- 24 and 2024-25, advances category accounted for the largest share in 2025-26. In value terms, frauds were concentrated in the advances category across the three years, the RBI said.

The RBI is exploring the possibility of introducing a ‘switch on’ and ‘switch off’ facility for all digital payment modes along with a ‘kill switch’ to block all debits from the account in one stroke. This facility would help bolster consumer confidence and contribute towards controlling frauds in digital payment transactions, the RBI Annual Report said.

A ‘kill switch facility’ is a mechanism that allows a system, device, account, or service to be shut down, disabled or blocked immediately in an emergency or under specific conditions.

The RBI report said ‘switch on’ and ‘switch off’ facility for domestic and international card transactions is available to customers which has helped customers exercise greater control.

The RBI said it will address the continuing challenge of authorised push payment frauds – where customers themselves initiate payments despite the various safeguards already in place such as mandatory additional factor of authentication (AFA), payee name lookup, card controls, tokenisation, and related measures, introduction of certain frictions in digital payment processes would be explored, with a view to enhancing customer protection and facilitating more effective recovery of funds.

The RBI’s initiative to introduce an exclusive ‘.bank.in’ domain, marked India as the first country globally to mandate a secure domain for the banking system thereby strengthening cybersecurity and reducing digital payment frauds.