PSU banks' compensation against fraud rises over three-fold to Rs 140 cr

Public sector banks have reported over three-fold jump in compensation towards frauds or e-frauds reported by their customers to Rs 140 crore during 2023-24, Parliament was informed on Tuesday.

The amount of compensation paid by these banks stood at Rs 42.70 crore in the previous fiscal, Finance Minister Nirmala Sitharaman said in a written reply to the Rajya Sabha.

Union Bank of India paid the highest compensation of Rs 74.96 crore followed by Bank of India at Rs 20.38 crore and Indian Bank at Rs 16.16 crore during FY24, she said.

In FY23, Union Bank of India was again the highest compensation payer at Rs 12.18 crore followed by Central Bank of India at Rs 11.68 crore.

Sitharaman further said that RBI, in July 2017, issued instructions on limiting the liability of customers in cases of unauthorised electronic banking transactions.

As per these instructions, a customer has zero liability if the unauthorised transaction occurs on account of contributory fraud or negligence/deficien