Electronic Banking Frauds: The Case of India

Background Of E-Banking Fraud

The banking sector around the world plays an essential role in promoting sustainable growth and economic activity. As intermediaries between users and providers of funds, banks are successfully placed in a continuum that controls the pulse economy (Rampini & Viswanathan, 2019). Around the world, the failure of the banking sector to effectively perform its intermediation functions and the failure to control the financial problems it has faced so far have raised serious concerns. (Gertler & Nobuhiro, 2010). Rampini and Viswanathan (2010) state that the main feature of business in the banking sector is the performance of the functions of authorized observers and advisers of borrowers on behalf of legal depositors.

Banks face challenges in preventing and detecting fraud, and these challenges are often compounded by existing organizational structures, policies, regulatory frameworks, and new technological approaches. However, banks must protect themselves in this special relationship with borrowers and depositors’ confidence and trust (Ali, Lei & Wei, 2018). The failure of banks to perform their role satisfactorily resulted from the risks they are exposed to that are not adequately controlled (Papazoglou, 2003). One of these risks that are gradually becoming a burden is the banking risk associated with fraud. In addition, fraud, an intentional deception act that causes society to suffer monetary or physical loss, is now a global threat to the entire banking industry (Ramamoorti, Morrison & Koletar 2013).