UPDATED 3.45PM Labour wants Indian students who fraudulently obtained student visas to be sent home if they don't have the funds to support themselves here.

Labour MP Iain Lees-Galloway has released Immigration New Zealand papers he says show endemic fraud on behalf of Indian immigration agents, who have deliberately falsified financial details to support visa applications.

The papers show more than 50 students currently in the country are thought to have submitted fraudulent applications.

Lees-Galloway said the papers implicate 15 bank managers in India as presenting fraudulent documents on behalf of foreign students studying here.

The bank managers allegedly doctored genuine information, which was then used by education agents to prove students had the funds to pay for their New Zealand tuition.

"Immigration New Zealand in their advice to the Minister said that there is no agent they have dealt with who hasn't engaged in this type of fraud, so there's potentially huge numbers involved in this," said Mr Lees-Galloway.

Mr Lees-Galloway said there's a case to be made for students with sufficient cash to support themselves to be allowed to stay.

However, he argues that "those students who cannot financially support themselves in New Zealand, it really wouldn't be fair on them to allow them to stay in New Zealand, and they probably do need to go home."

The Government says the issue is being dealt with.

Tertiary Education Minister Steven Joyce said the Indian market does have a degree of challenge to it.

He said that applies to other countries as well such as; the US Australia, Canada, and the UK.

"And all of the countries do have some difficulty with fraud from time-to-time, but it seems to be the nature of the market, and the job is to make sure you police it thoroughly, and that's what we're doing."