Summary of this article
Banks reported Rs 1.42 lakh crore frauds over five years.
Fraud account recoveries totalled Rs 6,389 crore during period.
Recovery agency complaints more than doubled to 18,021 in FY26.
Banks and financial institutions have reported fraud involving Rs 1.42 lakh crore over the past five financial years, while recovery from accounts classified as fraud has totalled Rs 6,389 crore during the same period, Minister of State for Finance Pankaj Chaudhary has informed the Rajya Sabha in a written reply.
As per the Reserve Bank of India (RBI) data cited in the reply, the total amount involved in frauds, based on the date of reporting, has stood at Rs 1,42,112 crore during the last five financial years. The data covers commercial banks and All India Financial Institutions.
Commercial banks include public sector banks, private sector banks, foreign banks, small finance banks, payments banks and local area banks.
Recovery from fraud accounts has remained an ongoing process. During the five-year period, banks have recovered an aggregate of Rs 6,389 crore from accounts classified as fraud, according to the information provided in Parliament.
Action Against Wilful Defaulters
Separate data reported by public sector banks has shown that recovery suits have been filed against 15,577 wilful defaulters as of March 31, 2026.
Action under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act has been initiated in 10,894 cases. FIRs have also been filed in 7,173 cases.
Public sector banks have recovered an aggregate of Rs 52,360 crore from wilful defaulters as of March 31, 2026.
The government has clarified that the RBI does not maintain information on action taken against wilful defaulters. The figures on recovery suits, action under the SARFAESI Act and FIRs have been reported by public sector banks.
Wilful defaulters are those borrowers who have failed to meet repayment obligations despite having the ability to repay, or have diverted or siphoned off funds, among other conditions specified under the banking framework.
Complaints Against Recovery Agencies Rise
Banks have received 18,021 complaints against recovery agencies in FY26, more than double the 8,623 complaints recorded in the previous financial year.
The RBI has also issued directions regarding the conduct of recovery agents and the process followed by banks while appointing them.
The central bank has also directed banks not to resort to undue harassment while recovering dues from borrowers.
Banks have also been required to follow a due diligence process while engaging recovery agents.
The directions cover the conduct of recovery agents and the responsibility of banks in their engagement. The complaint figures have been provided by the government in response to a question in Parliament.
