Public Sector Banks (PSBs) in India hold a commanding position in the banking sector, comprising more than 50% of market share, branches, and Automated Teller Machines (ATMs), according to a State Bank of India report.
PSBs manage over 63% of the total ATMs nationwide, while private banks oversee 35%. In terms of deposits, PSBs account for 59% of the total public deposits, underscoring a high level of public trust. Private banks, in contrast, hold 32% of the total deposits.
In digital banking, PSBs lead by issuing more than 54% of all credit cards in India. Private banks maintain a 37.8% market share in the credit card segment.
The report highlights the State Bank of India (SBI) as a leader across key metrics, including deposits, ATM network size, and credit card issuance.
Efficiency in the banking sector has improved notably, with PSBs operating at 82.76% efficiency compared to 79.59% for private banks. Total Factor Productivity (TFP) has grown by approximately 6%, driven largely by efficiency gains rather than technological advancements.
While PSBs dominate various aspects of banking, private banks contribute significantly to competition and offer diverse services. The banking landscape has further diversified with the introduction of payment banks, small finance banks, and Regional Rural Banks (RRBs), enhancing financial inclusion across India.
