Loans given to MSMEs during pandemic have higher fraudulent risk: Deloitte Survey

Mumbai, 18 Jan (KNN) According to a banking survey conducted by Deloitte India, loans given to SMEs during the pandemic have a higher fraudulent risk as they are not monitored by the banks. 

Emerging as an area of concern, the survey stated that 51 per cent of the respondents said that they do not include MSME assets in their monitoring process. 

It also found that majority of financial institutions polled said end-use monitoring was the most vulnerable stage within the corporate and MSME loan cycle to pose the greatest risk of fraud. 

In view of increase in fraud cases over the next two years, 78 per cent respondents agreed to that. 

The primary reason for the increase in fraud is large-scale remote working model  and usage of non-branch banking channels.