How are DFS interventions enhancing the financial health of the Indian banking sector?
Synopsis
The DFS's strategic interventions have dramatically improved the financial health of Indian banks, with SCBs' gross NPA ratio falling to 2.22% and PSBs' to 2.58%. A significant rise in provision coverage and record net profits signify robust banking health, while digital payment growth and financial inclusion initiatives are enhancing accessibility for marginalized communities.
Key Takeaways
Gross NPA ratio for SCBs is down to 2.22% .
Provision coverage ratio has reached 93.14% .
Record net profits for SCBs and PSBs in FY 2024-25.
Digital payment transactions volume has soared significantly.
Financial inclusion initiatives are expanding access for marginalized communities.
New Delhi, Jan 10 (NationPress) - The Department of Financial Services (DFS) has made strategic interventions that have significantly bolstered the financial stability and strength of the banking sector. According to an official statement released on Saturday, the gross Non-Performing Asset (NPA) ratio of scheduled commercial banks (SCBs) has fallen to 2.22%, while that of public sector banks (PSBs) has decreased to 2.58%.
Moreover, the Provision Coverage Ratio (PCR) for SCBs has risen from 49.31% in March 2015 to an impressive 93.14% in March 2025.
During the fiscal year 2024-25, SCBs achieved an all-time high aggregate net profit of Rs 4.01 lakh crore, while PSBs also recorded their highest net profit ever at Rs 1.78 lakh crore during the same period.
Additionally, the net profit for PSBs in the first half of FY 2025-26 reached Rs 0.94 lakh crore.
Global deposits and advances for PSBs surged from Rs 71.95 lakh crore and Rs 56.16 lakh crore in March 2015, to Rs 146.27 lakh crore and Rs 114.85 lakh crore, respectively, by September 2025.
In FY 2024-25, PSBs declared dividends amounting to Rs 34,990 crore (with the Government of India receiving Rs 22,699 crore), an increase from Rs 27,830 crore in dividends to shareholders (with the GoI share being Rs 18,013 crore) in FY 2023-24, as per the official statement.
In the realm of digital payments, the DFS has reinforced its leadership role, fostering consistent growth through the DIGIDHAN Mission.
The volume of digital payment transactions soared to 22,831 crore in FY 2024-25, reflecting a CAGR of 41% from 2,071 crore in FY 2017-18. The transaction value escalated from Rs 1,962 lakh crore to Rs 3,509 lakh crore, as stated by the Ministry of Finance.
Financial inclusion remains a key focus area, with initiatives such as the Pradhan Mantri Jan Dhan Yojana (PMJDY), Pradhan Mantri Jeevan Jyoti Bima Yojana, Pradhan Mantri Suraksha Bima Yojana, MUDRA, Stand Up India, and Atal Pension Yojana making noteworthy advancements. By 2025, these programs have extended their reach, ensuring that millions of citizens, particularly from marginalized communities, gain access to vital banking, insurance, and pension services,” the statement elaborated.
Point of View
The ongoing reforms and initiatives spearheaded by the DFS showcase a commitment to strengthening the Indian banking sector. This approach not only addresses immediate financial health concerns but also paves the way for sustainable growth and broader financial inclusion, aligning with our nation's commitment to economic empowerment.
NationPress
11 May 2026
Frequently Asked Questions
What is the current gross NPA ratio for SCBs?
The gross NPA ratio for scheduled commercial banks (SCBs) is currently at 2.22%.
How much did PSBs declare in dividends for FY 2024-25?
PSBs declared dividends amounting to Rs 34,990 crore in FY 2024-25.
What initiatives are being taken for financial inclusion?
Initiatives like PMJDY, Jeevan Jyoti Bima Yojana, and Atal Pension Yojana are key in enhancing financial inclusion.
What was the net profit of SCBs in FY 2024-25?
SCBs recorded a net profit of Rs 4.01 lakh crore during FY 2024-25.
How has digital payment growth been in recent years?
Digital payment transactions increased to 22,831 crore in FY 2024-25, with a CAGR of 41%.
