Finance Ministry Directs State-Owned Banks to Strengthen Digital Systems
- 21 Nov 2023
Recently, the Finance Ministry has urged state-owned banks to conduct a thorough review of their digital operations, prompted by the recent UCO Bank incident.
- In response, banks have been advised to assess their cybersecurity measures and implement enhancements to fortify their systems.
Key Points
- Cybersecurity Assessment: State-owned banks are instructed to scrutinize their systems and processes related to digital operations to ensure robust cybersecurity measures are in place.
- Vigilance and Preparedness: Banks are advised to maintain a vigilant stance and prepare for potential future cyber threats, emphasizing the importance of proactive measures.
- Sensitization by Authorities: The Finance Ministry and RBI have consistently sensitized banks about cybersecurity in light of the increasing digitization within the financial sector.
- UCO Bank Incident: UCO Bank, based in Kolkata, reported an erroneous credit of Rs 820 crore to account holders via the Immediate Payment Service (IMPS). Technical issues during November 10-13 resulted in certain transactions crediting UCO Bank accounts without actual funds from other banks.
- Recovery Efforts: The bank promptly blocked the recipients' accounts and has successfully recovered Rs 649 crore, equivalent to 79% of the erroneously credited amount.
