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The government has set an ambitious goal for India's public sector banks (PSBs), with senior officials at the Finance Ministry's PSB Manthan 2025 in New Delhi confirming that efforts are underway to place at least two PSBs among the world's top 20 banks by assets. According to sources, consolidation is not part of the roadmap, marking a shift from the merger-driven approach seen in earlier phases of banking reforms.

Currently, State Bank of India (SBI) is the only Indian public lender in the world's top 50 banks, ranked 47th by assets, as per global banking rankings. To reach the top 20, officials and industry leaders agreed that PSBs will need to expand their scale, strengthen governance structures, adopt digital banking and artificial intelligence and build a stronger global footprint.

The two-day conference placed technology adoption at the heart of future growth. Banking executives and technology experts stressed that artificial intelligence must be treated as a strategic investment rather than a cost. They highlighted its potential to deliver personalised services, improve risk management, and increase operational efficiency. The aim is to blend automation with the trust and accessibility that have long defined public sector banking in India.

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Discussions also focused on the need for stronger governance and accountability. Participants, including Reserve Bank of India Deputy Governor Swaminathan J, emphasised that board oversight must be reinforced while allowing banks operational autonomy. They said, is critical for PSBs to compete with global peers while maintaining transparency and credibility.

Even as global ambitions dominated the agenda, the conference placed emphasis on domestic priorities. Expanding credit flow to agriculture and micro, small and medium enterprises (MSMEs) was identified as a key pillar for rural development, job creation, and support for India’s growing entrepreneurial base. Officials said a robust push in these areas will keep PSBs rooted in national development goals even as they pursue global rankings.

With global trade and capital flows shifting, PSBs are being encouraged to widen their international operations. New opportunities in trade finance, cross-border payments and project financing are expected to be explored. Officials said building a stronger global presence is vital for Indian banks to achieve the scale needed to enter the world's top 20. In a clear departure from past strategies, government sources said consolidation is not on the table. Instead, the emphasis is on organic growth, customer-first innovation and technology adoption. Strengthening each bank individually, officials stressed, offers a more sustainable and resilient path forward than mergers.

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