Indian banks are witnessing a significant increase in fraud-related losses, with 84% of banking leaders reporting higher fraud losses over the past year, according to a new survey by BioCatch.
The global survey included 1,440 professionals working in fraud management, anti-money laundering (AML), risk, and compliance across 25 countries. The findings indicate that India is among the most affected and concerned markets regarding financial fraud and AI-powered cyber threats.
According to the report, 84% of respondents believe AI agents will become the biggest exploitable vulnerability for the banking industry over the next year.
Among the 100 banking and financial crime prevention leaders surveyed in India, 90% said fraud attempts against their institutions increased during the past year, well above the global average of 81%. This represents a notable jump from 70% in the previous year’s survey.
The study also found that 84% of Indian banking leaders reported growing fraud losses, compared to the global average of 76%. In 2025, only 57% of Indian respondents reported a rise in fraud losses.
Concerns about artificial intelligence are growing rapidly. Around 93% of Indian respondents said AI has made fraud and scam operations more sophisticated, while 90% believe it will become increasingly difficult to differentiate between legitimate AI-assisted activities and malicious actions.
The speed of fraudulent activities is another major concern. Nearly 95% of Indian banking leaders expressed serious concerns about the growing speed of fraud, significantly higher than the global average of 76%.
Financial losses remain substantial. About 48% of respondents said their institutions lose more than USD 10 million annually due to fraud. Within this group, 32% reported losses exceeding USD 25 million, 16% reported losses above USD 50 million, and 6% said annual losses surpass USD 100 million.
Customers are also bearing heavy losses. Around 58% of respondents estimated that customers lose more than USD 5 million each year to scams, while 44% reported customer losses exceeding USD 10 million annually.
Instant payment platforms have emerged as a major fraud channel. Nearly 66% of Indian banking leaders identified scams through instant payment systems as the leading cause of increasing fraud. The report suggests that the rapid expansion of UPI transactions may be creating additional opportunities for fraudsters.
Commenting on the findings, BioCatch CEO Gadi Mazor said that AI is transforming how consumers interact with financial institutions and online businesses. He warned that criminals are also leveraging AI to conduct more advanced fraud and financial crimes.
Mazor emphasized that as digital interactions become faster, more automated, and increasingly powered by AI, financial institutions must move beyond traditional identity verification methods and focus more on behavioural analysis, intent assessment, and trust-based security measures to combat emerging fraud threats.
