New Delhi: The government is examining a proposal to set up special courts for faster disposal of bank fraud cases. The law and finance ministries have begun discussions on the matter, and have sought views from banks, said people familiar with the developments.

Currently 857 fast-track courts have been established for dealing with cases of heinous crimes and those involving senior citizens, women, and children.

“These are preliminary stage deliberations. Based on the recommendations, a final structure will be worked out, including what should be the minimum amount for such fraud cases to be heard by these special courts,” said an official requesting anonymity.

Last year, a parliamentary committee had also suggested setting up special courts to deal with fraud cases.

“We are examining all options,” said the official cited above.

Lenders have been seeking such a structure as it would help in quick disposal besides aiding in more financial recovery.

“Often it has been the case that delay in action leads to low recovery, and the assets also get deteriorated. Any faster mechanism will also help banks save in legal costs,” said a senior bank executive.

As per the latest guidelines by the Reserve Bank of India, or RBI, all regulated entities have to issue a detailed show-cause notice to the persons, entities, and their promoters or whole-time and executive directors against whom an allegation of fraud is being examined.

“So, if the banks have already done the due diligence, rather than the defaulters prolonging the matter through courts, a fast-track court can expeditiously give its judgement,” said another bank executive.

A total of 122 fraud cases with amounts involving ₹18,674 crore pertaining to previous financial years were reported afresh in FY25 by banks after complying with RBI directions, according to latest available data.

As per the Central Vigilance Commission, or CVC, guidelines, all state-run banks, insurance companies, and financial institutions should refer instances of fraud of at least ₹3 crore to the Advisory Board for Banking and Financial Frauds (ABBFF) for advice. Additionally, the board has also been empowered to periodically carry out fraud analysis in the financial system and give inputs, if any, for policy formulation related to frauds to the RBI and CVC.

Banks are already working to set up Digital Payments Intelligence Platform (DPIP), as a Section 8 company, or non-profit organisation, which will seek to enhance fraud risk management through real-time intelligence sharing and prevent fraudulent transactions.>