New Delhi, April 19 (NationPress) The banking industry in India has demonstrated remarkable resilience, bolstered by enhanced asset quality, stronger capital reserves, vigorous retail and SME credit growth, and initial indications of a rebound in private capital investment, according to a recent survey released on Sunday.

The research conducted by FICCI and the Indian Bank Association (IBA) indicated that the banking sector holds a generally optimistic perspective on credit growth in the short term, supported by healthier balance sheets, consistent economic activities, and sustained demand across various sectors of the economy.

Survey participants expect the current monetary policy to remain relatively stable in the upcoming months, indicating that the existing policy framework is well-calibrated to balance growth and inflation.

Only cooperative banks were singled out, with all respondents anticipating a 25-basis point increase in rates.

Expectations for overall credit expansion remain favorable, with banks predicting ongoing momentum in non-food credit, as highlighted in the report.

Public Sector Banks (PSBs) display notable confidence regarding the outlook, reflecting improved asset quality, enhanced capital positions, and increased traction in corporate lending.

Private banks are taking a balanced and selective approach to credit growth, while foreign banks maintain moderate optimism, consistent with their targeted focus on corporate and institutional segments, as noted in the report.

From a sectoral perspective, credit demand from the services and retail sectors is anticipated to be a primary driver of overall lending growth. The outlook for the services sector shows strong expectations for expansion, supported by activities in real estate, financial services, logistics, and tourism-related industries.

Approximately 46 percent of survey participants anticipate non-food credit growth in the range of 11 percent to 13 percent, which reflects the predominant view.

Retail lending is also expected to remain strong, further reinforcing its significance as a core component of banking sector growth.

Demand for SME credit is projected to stay exceptionally robust, with respondents expressing strong confidence in continued expansion in this area. This trend reflects rising business activity among smaller enterprises, increased formalization of credit channels, and ongoing policy focus on supporting MSME development, according to the report.

Banks have identified cybersecurity risk as the most critical challenge facing them. A total of 24 banks, including public sector banks, private sector banks, foreign banks, small finance banks, and cooperative banks, participated in the survey conducted between January and February 2026.