A concerning rise in large-scale data breaches has put cybersecurity agencies on high alert, with central cyber and intelligence bodies actively tracking incidents linked to bank employees and third-party vendors.

According to a senior government official, the matter has escalated to the highest levels, prompting an urgent meeting at the Ministry of Home Affairs (MHA) a few weeks ago to strategize countermeasures. Investigations reveal that unrestricted access to sensitive banking data—provided to employees and third-party vendors—is a major factor fueling cyber fraud and substantial financial losses for citizens.

“The exposure of highly sensitive banking data to employees, particularly outsourced staff and third-party vendors, is leading to severe information leaks. Cybercriminals are exploiting this breach to systematically target and defraud citizens," a top government official told News18, referencing a government report.

What intensifies concerns further is the suspected involvement of senior banking officials. Intelligence agency representatives at the MHA meeting highlighted that both public and private sector banks are failing to take action against fraudulent activities despite repeated complaints. “Shockingly, banks are neglecting action on nearly 60-70 percent of fraudulent accounts reported on the National Cybercrime Reporting Portal (NCRP)," a senior official who attended the meeting stated.

Financial intelligence agencies have also flagged critical lapses in banking security. “A comprehensive analysis of cyber fraud trends, mule accounts, and banks’ response times was presented at the meeting. The findings indicate a staggering increase in cybercrime incidents, proving that existing security measures are failing. Banks appear reluctant to take corrective action, raising serious concerns about their accountability," sources told News18.

With cybercrime evolving at an alarming pace, authorities stress the need for immediate and stringent action in line with the latest Reserve Bank of India (RBI) advisory. Officials caution that unless banks strengthen internal controls and implement decisive measures, unchecked data leaks from within their infrastructure will continue to fuel cybercriminal networks, placing millions of customers at risk.