Tuesday, January 26, 2021

Indian Banks Duped Of $11 Billion in Last 3 Years: Reserve Bank of India

Indian Banks have been duped Of $11 Billion, approximately INR 70,000 crores thanks to the likes of Vijay Mallya, Mehul Choksi, Nirav Modi among other fraudsters.  As stated by the government in the upper house of the Parliament on Tuesday, Banks have taken a hit of about INR 70000 crores due to frauds in the last three years. The information was furnished by the Minister of State for Finance, Shiv Pratap Shukla in accordance with RBI data. 

The losses of commercial Indian banks in fraud cases between 2015-16, 2016-17 and 20117-18 amounted to INR 16,409 crores, 16,652 crores and INR 36,694 crores respectively. The minister stated that these losses are as per the year of reporting and not the occurrence of the fraud. The gross advances by scheduled commercial banks in India rose from INR 68.75 lakh crores in 2018 as against INR 25 lakh crores in 2008.

During his replies in the Rajya Sabha, the minister also stated that there are about 139 lenders whose gross non-performing assets (NPAs) are more than INR 1000 crores. He sighted aggressive lending practices as the core reason behind the loss witnessed by the scheduled commercial banks. An economic slowdown, wilful default and corruption have added to the instances of loan frauds as per the minister of state for finance.

The Reserve Bank of India and the central bank had issued a set of guidelines to the scheduled commercial banks in 2017 regarding insolvency. The guidelines were issued to initiate the filing of applications to initiate corporate insolvency resolution process for 12 lenders.

Recent cases of massive bank frauds by wilful defaulters have brought a bad name to financial institutions in India and have highlighted the corruption rooted in them. These wilful defaulters then find an easy way out in fleeing abroad hence ensuring an indemnity against Indian laws. Now the onus lies on the RBI to filter the banking system and bring down the instances of frauds among scheduled commercial banks.

More News at EurAsian Times

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