Cybercrime is becoming far more expensive for Indian businesses.
The average cost of a data breach in India has risen to a record ₹25.5 crore in 2026, up nearly 16 per cent from ₹22 crore last year, according to IBM's 2026 Cost of a Data Breach Report. The study also found that cyberattacks are growing in scale, with the average breach exposing nearly 39,500 records, the highest on record.
Artificial intelligence is emerging as one of the biggest reasons behind the shift. IBM said 26 per cent of malicious data breaches in India were AI-generated, reflecting how cybercriminals are increasingly using AI to launch faster, more sophisticated and highly scalable attacks.
The report also found a sharp gap between organisations that have embraced AI-driven security and those that have not. Companies with extensive AI and security automation reported an average breach cost of ₹21.3 crore, while those without such systems suffered average losses of ₹31.6 crore.
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Read Now The Age of Anger IBM's Vice President for Technology in India and South Asia, Gaurav Agarwal, said AI is transforming both sides of the cybersecurity battle. While it is accelerating innovation, it is also enabling attackers to become more effective. He argued that businesses need to deploy AI across the entire security lifecycle—from threat detection and analysis to prioritisation and response—rather than limiting its use to basic monitoring.
Despite the growing threat, AI adoption in cybersecurity remains uneven. Only 32 per cent of organisations surveyed said they had extensively deployed AI and security automation, while an equal proportion reported having no meaningful AI adoption at all.
Phishing—including email, voice and SMS scams—continued to be the most common entry point for cyberattacks, accounting for 19 per cent of all breaches. Drive-by compromises and supply-chain attacks were among the other leading attack vectors.
The financial services sector recorded the highest average breach cost at ₹40.9 crore, followed by technology (₹35.7 crore) and communications (₹34.5 crore), underscoring the growing risks facing industries that handle large volumes of sensitive data.
The report also highlighted that proactive cybersecurity measures pay off. Organisations that regularly conducted red teaming and penetration testing reduced their average breach costs by ₹2.47 crore. Nearly three in four organisations said they now plan to increase investments in incident response, threat detection, identity management, AI security and employee awareness after experiencing a breach.
(With inputs from ANI)