Expressing an urgent need to check rising frauds, the RBI wants Indian Banks' Association (IBA) to set up a training institute in collaboration with lenders to impart forensic investigation skills to bank staff.

"To enhance investigation skills of the staff in the fraud risk management group, a training institute for financial forensic investigation may be set up by banks under the aegis of IBA," a RBI's working group has suggested.

Most retail cyber frauds and electronic banking frauds are estimated to be of values less than Rs 1 crore.

The working group on information security, electronic banking and technology risk management has also called for setting up special cells on banking frauds in state police departments to deal with bank related cyber crimes.

The central bank has said it "will begin implementing the recommendations of the Working Group shortly".

The working group further said the activities of fraud prevention, monitoring, investigation, reporting and awareness creation should be owned and carried out by an independent fraud risk management group in the bank.

"Quick fraud detection capability would enable a bank to reduce losses and also serve as a deterrent to fraudsters," the report said, adding that the fraud risk management group should be adequately staffed and headed by a senior official.

The standing forum provided by the IBA can be used to share best practices and further strengthen internal controls in respective banks, said the report said.