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Deposits under Pradhan Mantri Jan Dhan Yojana (PMJDY) stood at Rs 1.06 lakh crore (US$ 15.17 billion) with 37.34 crore accounts registered.

Indian Banking Industry Analysis

    Last updated on Oct, 21 2020

The Indian banking system consists of 12 public sector banks, 22 private sector banks, 44 foreign banks, 56 regional rural banks, 1,485 urban cooperative banks and 96,000 rural cooperative banks in addition to cooperative credit institutions. As on May 31, 2020, total number of ATMs in India increased to 210,415 and is expected to reach 407,000 by 2021.

According to Reserve Bank of India (RBI), India’s foreign exchange reserve reached US$ 534.56 billion as on July 31, 2020. According to RBI, bank credit and deposits stood at Rs 102.19 lakh crore (US$ 1.45 trillion) and Rs 140.20 lakh crore (US4 1.98 trillion), respectively, in the fortnight ending July 31, 2020.

Credit to non-food industries stood at Rs 101.33 lakh crore (US$ 1.43 trillion) on July 31, 2020.

Asset of public sector banks stood at Rs 72.59 lakh crore (US$ 1,038.76 billion) in FY19.

Total assets across the banking sector (including public, private sector and foreign banks) increased to US$ 2.27 trillion in FY19.

Indian banks are increasingly focusing on adopting integrated approach to risk management. The NPAs (Non-Performing Assets) of commercial banks has recorded a recovery of Rs 400,000 crore (US$ 57.23 billion) in FY19, which is highest in the last four years.

As per Union Budget 2019–20, investment-driven growth required access to low cost capital, and this would require investment of Rs 20 lakh crore (US$ 286.16 billion) every year.

RBI has decided to set up Public Credit Registry (PCR), an extensive database of credit information, accessible to all stakeholders. The Insolvency and Bankruptcy Code (Amendment) Ordinance, 2017 Bill has been passed and is expected to strengthen the banking sector. Total equity funding of microfinance sector grew 42% y-o-y to Rs 14,206 crore (US$ 2.03 billion) in 2018–19.

Bank accounts opened under the Government’s flagship financial inclusion drive Pradhan Mantri Jan Dhan Yojana (PMJDY) reached 40.05 crore and deposits in Jan Dhan bank accounts stood at more than Rs 1.30 lakh crore (US$ 18.44 billion).

Rising income is expected to enhance the need for banking services in rural areas, and therefore, drive the growth of the sector.

The digital payments revolution will trigger massive changes in the way credit is disbursed in India. Debit cards have radically replaced credit cards as the preferred payment mode in India after demonetisation. Payments on Unified Payments Interface (UPI) hit an all-time high of 1.49 billion in terms of volume with transactions worth nearly Rs 2.90 lakh crore (US$ 41.22 billion) in July 2020.

Indian Banking Industry Report (September, 2020)
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Click to access the Banking Industry Archived Report

Banking India

Growth in money supply over past few years (US$ billion)
Gross NPAs to Gross Advances in India

 

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