Archive · 13 Nov 2025
Government Reviews Public Sector Banks' Performance, Focus on AI and Digital Security
India's finance ministry met with its big government-owned banks, called PSBs, to check how they did in the first half of the year.
The banks made a lot of money, over ₹93,000 crore, and their loans are getting healthier.
The ministry wants the banks to keep attracting easy-to-get money and lending it out, especially to small businesses and farmers.
They also talked a lot about online banking, making sure it's safe and easy for everyone, even people who aren't tech-savvy.
Using smart computer tools, like AI, to help customers better was also a big topic.
The banks showed off their new mobile apps and discussed how to get better at catching problems early and fixing customer complaints faster.
The meeting also touched on helping start new projects in areas like green energy and tourism, all part of India's plan to become a developed nation by 2047.
Public Sector Banks (PSBs) reported a net profit exceeding ₹93,675 crore in the April-September period, with a 1.08% return on assets and improved cost of funds.
The finance ministry urged PSBs to maintain momentum in low-cost deposit mobilization and credit growth, particularly focusing on MSME and agriculture sectors.
Discussions emphasized the need for digital banking to remain inclusive and secure, with a call to enhance cyber resilience and improve grievance redressal.
Adoption of responsible AI and data analytics was encouraged to enhance customer service delivery, alongside strengthening risk management and underwriting practices.
A review meeting highlighted progress in credit growth for champion sectors and discussed leveraging digital platforms for faster loan resolutions and improved asset quality.
- Who
- Union finance ministry officials, Public Sector Banks (PSBs), M. Nagaraju (Secretary, Department of Financial Services), Unique Identification Authority of India (UIDAI)
- What
- Review of PSBs' financial performance, asset quality, digital transformation, and progress on government schemes; discussions on AI in banking, digital security, and credit growth.
- When
- Wednesday, November 12, 2025 (meeting); April-September period of FY26 (performance review)
- Where
- India
- Why
- To assess PSB performance, guide future strategies for credit growth, digital banking security, and technological adoption in line with the 'Viksit Bharat by 2047' vision.
Emphasis on Traditional Financial Growth
Focus on Digital Innovation and Security
Credit Growth and Deposit Mobilization
Emphasis on Traditional Financial Growth
The finance ministry emphasized the need for Public Sector Banks (PSBs) to sustain momentum in low-cost deposit mobilization and credit growth, particularly in crucial sectors like MSME and agriculture, indicating a focus on traditional banking drivers of economic expansion.
Focus on Digital Innovation and Security
While also a focus, the government highlighted the importance of digital banking remaining inclusive and secure, pushing for enhanced cyber resilience, operational continuity, and better grievance redressal, underscoring the need to adapt to the digital financial landscape.
Technological Integration in Banking
Emphasis on Traditional Financial Growth
The discussions on financial performance and credit growth to key sectors point to a foundational approach to banking operations.
Focus on Digital Innovation and Security
The meeting actively encouraged the adoption of responsible AI and data analytics for improved customer service delivery and explored human-AI convergence, signaling a strong push towards leveraging advanced technology.
- Public Sector Banks Net Profit (April-September)
- ₹93,675 crore
- Aggregate Business (September 2025)
- ₹261 trillion
- Advances Growth (YoY)
- 12.3%
- Deposits Growth (YoY)
- 9.6%
- Gross NPA Ratio
- 2.30%
- Net NPA Ratio
- 0.45%
- Return on Assets
- 1.08%
- Cost of Funds
- 4.97%
Sources
Explainer: Why India needs bigger banks
PSBs increase market share in outstanding individual home loans
India wants bigger banks to match global giants—But size alone doesn't assure better outcomes
Public sector banks reported over ₹93,000 crore net profit in April-September
NTPC scouting for land in over a dozen states for setting up nuclear power plants
Use ‘responsible AI’, data analytics for better customer service: Finance Ministry to public sector banks
Analysts, Rating Agencies Raise Credit Growth Outlook for H2 FY2026
