Govt to constitute high-powered panel to review banking sector, says Nirmala Sitharaman

Union finance minister Nirmala Sitharaman had announced a high-level committee on banking for Viksit Bharat in the Budget for 2026-27 (FY27)

After strengthening India’s banks, the government prepares to constitute a high-powered committee to comprehensively review the sector and align it with India’s next phase of growth, which will also focus on banking for youth, Union finance minister Nirmala Sitharaman said on Monday.

She was speaking on the seven themes of the Public Sector Bank (PSB) Confluence 2026 in the national Capital. (@nsitharamanoffc)

Speaking on the seven themes of the Public Sector Bank (PSB) Confluence 2026 in New Delhi, the minister said, the two-day “intensive” discussions are happening at time when “the announcement on the high-powered committee to look into banking for Viksit Bharat” is expected.

The seven thematic tracks of the two-day conference are -- deposit mobilization, banking for youth, supporting the investment cycle, supporting global capability centres (GCCs), agriculture and horticulture value chain infrastructure, re-imagining the credit card business, and the priority sector lending.

Addressing the bankers at the conference, Sitharaman said, “Sooner the committee will be announced and the material that you are producing from [the] two-day discussions on the basis of well-researched set of documents -- which have been shared with you in advance -- will hopefully provide the substantive meat for the committee to also look at.”

In her budget speech on February 1 this year, Sitharaman said India’s banking sector is now characterised by strong balance sheets, historic highs in profitability, improved asset quality and coverage exceeding 98% of villages in the country. “At this juncture, we are well placed to futuristically evaluate the measures needed to continue on the path of reform-led growth of this sector,” he said.

In her speech she proposed setting up a “High Level Committee on Banking for Viksit Bharat” to comprehensively review the sector and align it with India’s next phase of growth, while safeguarding financial stability, inclusion and consumer protection.”

Giving credit to the department of financial services (DFS) for preparing thematic documents on seven different topics, the finance minister said they are “very critical for us” to discuss. DFS is an arm of the finance ministry. She said the “content materials for each of them are well researched, bringing in the best practices from around the globe” and also highlighting the need to discuss on these issues to take Indian banking sector forward.

Sitharaman mentioned one document in particular that was on the youth. “It classifies our youth nicely into different categories… highlighting the fact 29% of India’s population is between 15 and 29 years.” She urged participants to go through these documents and deliberate on issues raised in them so as to thrash out “workable ideas” for the committee because it is the bankers who would ultimately implement the measures to take Indian banking system to the next level.

The finance minister said the ideas generated in the two-day conference would be valuable for the committee because once the committee gives its recommendations, it is for the bankers to rapidly implement them. “Viksit Bharat 2047 is actually not far away. We are in 26 [2026] so, less than or short of 20 years that’s what we have before us,” she said.