Page 8 - Banking Finance March 2023

RBI CORNER

Reserve Bank

News

Bank loan frauds more The RBI had launched a pilot for retail crease in lending and deposit rates,
digital Rupee (e Rs. -R), or retail cen- the Reserve Bank of India (RBI) raised
than halved
tral bank digital currency (CBDC) on the repo rate by 25 basis points (bps)
Bank loan frauds decreased by 57% in December 1, 2022. to 6.5 per cent in its fight against in-
value terms to Rs 58,303 crore in FY22. flation.
"The total number of (e Rs.-R) transac-
The trend has continued in FY23 as well
tions (so far) are roughly about Das said while inflation is expected to
with just Rs 18,746 crore of loan fraud
7,70,000 but these are small value moderate in 2023-24, it is likely to rule
reported in the first half of FY23 as com-
transactions so the amount is small," above the 4 per cent target. "The out-
pared to Rs 35,034 crore a year ago.
the RBI Deputy Governor T Rabi look is clouded by continuing uncer-
According to RBI data, the amount Sankar said. tainties from geopolitical tensions, glo-
involved in loan fraud has steadily de- bal financial market volatility, rising
He said at present more than 50,000
clined over three years. The amounts non-oil commodity prices and volatile
users and over 5,000 merchants are
are based on the year the loans are crude oil prices. At the same time,
using retail digital rupee for transac-
classified and reported as fraud, while economic activity in India is expected
tions.
the fraud could have occurred several to hold up well. The rate hikes since
Sankar said there are eight banks that
years ago. The amount reported re- May 2022 are still working their way
flects the size of the loan account and are participating in the pilot phase and through the system… On balance, the
the RBI is planning to engage more
do not reflect the amount of loss in- MPC was of the view that further cali-
curred. Depending on the recovery, the banks. The pilot has been running in brated monetary policy action is war-
five cities, and the RBI is also looking
loss incurred gets reduced. ranted to keep inflation expectations
to expand the retail digital rupee pilot anchored, break the persistence of
Banks have gone slow on corporate
to nine more cities, he said. core inflation and thereby strengthen
loans due to their own inability as
the medium-term growth prospects.
many are faced lending restrictions
because of high bad loans. RBI hikes repo rate to Accordingly, the MPC decided to raise
the policy repo rate by 25 basis points
6.5%, projects GDP growth
to 6.50 per cent," he said.
Close to 7.70 lakh transac-
at 6.4% Das said the MPC will continue to
tions carried out using re- The six-member Monetary Policy Com- maintain strong vigil on the evolving
tail CBDC: RBI DG mittee (MPC) headed by RBI Governor inflation outlook so as to ensure that
Shaktikanta Das projected the real it remains within the tolerance band
RBI said close to 7.70 lakh small value
GDP growth at 6.4 per cent for 2023- and progressively aligns with the tar-
transactions have been carried out
24. get.
using retail digital Rupee (e-Rs.-R) in
five cities so far. IN a move that will lead to further in- Commenting on the policy, State Bank
BANKING FINANCE | MARCH | 2023 | 7