Bank of Baroda CEO: Cyber fraud rising, banks must invest in security and customer literacy

# What happened Debadatta Chand, MD and CEO of Bank of Baroda, spoke at the Global Fintech Fest about a rising tide of cyber fraud and what banks must do in response. He separated threats into two categories: vulnerabilities inside banks and vulnerabilities at the customer level. Chand said both require resources, but the remedies differ.

# The two vulnerability types

Customers: Chand highlighted customer-level risk such as "digital arrests" and other scams where individuals are social‑engineered or tricked into exposing credentials or funds. He argued that customer vulnerability can be reduced only through stronger financial and digital literacy, and that banks should invest heavily in awareness programs.

# Baroda is doing AI adoption: The bank uses AI across multiple areas: customer engagement, underwriting, product management, and back‑end customer care. It has a GenAI‑powered virtual relationship manager named Aditi that provides conversational banking services.

Phygital branches: To balance physical and digital needs, the bank developed a phygital branch model—digital self‑service tools combined with human assistance. Chand said there are 30 phygital branches so far and that many physical branches will be converted to this model over time.

Incident response: Following the July incident, the bank engaged a CERT‑In‑empanelled cybersecurity agency to conduct a comprehensive assessment and investigation into the possible business email compromise and any data exposure.

# Why Chand thinks action is needed now Chand framed the problem in practical terms: multiple attacks happen daily but firms and customers often treat cyber risk as abstract until they are directly affected. That gap, he said, explains the need for increased investment at the bank level and for focused programs to raise customer awareness and resilience.

# Concrete implications for banks and customers

• Banks should allocate more budget and staff to cybersecurity operations, monitoring, and incident response.
• Customer education must cover both financial literacy (recognizing fraud types) and digital literacy (account hygiene, phishing indicators, safe transaction practices).
• Technology adoption such as AI can improve customer service and underwriting, but it does not replace the need for robust security controls and monitoring.
• Branch networks will evolve: expect more phygital models where customers use digital tools with on‑site human support for complex needs.

# Bottom line Chand's message: treat cyber threats as immediate business risk. Invest in institutional security, investigate and remediate breaches promptly, and commit resources to raise customer awareness so individuals are less likely to be exploited by increasingly sophisticated scams.