The Government of India has constituted a high-level committee to review the country’s banking sector and recommend reforms aimed at strengthening its capacity to support long-term economic growth.
The Ministry of Finance announced the formation of the High Level Committee on Banking for Viksit Bharat on October 30, 2026. The panel has been tasked with recommending structural, institutional, regulatory and legislative changes to make Indian banks more globally competitive, financially inclusive and resilient as the country works towards its Viksit Bharat 2047 objective.
Editorial Insight
Key Highlights
Important points readers should notice.
Issue/Event: The Government of India has constituted the High Level Committee on Banking for Viksit Bharat to recommend reforms for the banking sector.
Location: India
Authority/Organisation: Ministry of Finance and Department of Financial Services.
Action Taken: Former Central Vigilance Commissioner Suresh N. Patel has been appointed chairperson; the committee has been given a six-month tenure.
Impact: The review is intended to identify reforms for stronger, more competitive and inclusive banking, but any changes will depend on subsequent government decisions.
Former Central Vigilance Commissioner Suresh N. Patel will chair the committee. Its three named expert members are Shirish Chandra Murmu, Deputy Governor of the Reserve Bank of India; Padmaja Chunduru, former Managing Director and Chief Executive Officer of Indian Bank; and N. S. Vishwanathan, former RBI Deputy Governor.
The Joint Secretary (Banking) in the Department of Financial Services will serve as the committee’s Member Secretary. The Ministry of Finance has specified a tenure of six months for the panel.
The committee was originally announced by Finance Minister Nirmala Sitharaman in the Union Budget 2026–27. The government had proposed a comprehensive review of the financial sector to align it with India's next phase of growth while safeguarding financial stability, inclusion and consumer protection.
Editorial Analysis
Why This Matters
Banks are important to the functioning of the wider economy because they connect savings with investment and provide credit to households, farmers, small businesses and large companies. A review of banking regulations, capital requirements and lending frameworks could help identify areas where existing systems need to adapt to changing economic conditions. The committee's examination of Regional Rural Banks and cooperative banks is particularly relevant to access to financial services beyond major cities. Its review of Priority Sector Lending and the Lead Bank Scheme will also consider how credit reaches sectors and communities that may have limited access to formal finance. The focus on artificial intelligence and digital innovation reflects the growing role of technology in banking. Digital services can improve efficiency, but they also require safeguards against cyberattacks, fraud, data misuse and operational disruption. The committee's recommendations could therefore influence several aspects of India's financial system. However, the formation of the panel should not be interpreted as an immediate change in interest rates, lending rules, bank ownership or customer services.
One of the committee’s major responsibilities will be to assess existing banking practices and prudential norms. It will identify international best practices and examine how they can be adapted to Indian conditions. The review is also expected to produce a roadmap for developing banks capable of competing more effectively in global markets.
The panel will examine the regulatory and legal frameworks governing banks, including Regional Rural Banks and cooperative banks. It will consider possible reforms to improve operational efficiency and make banking services easier to access and use.
Another area of focus will be the long-term capital requirements of banks, Development Financial Institutions and Non-Banking Financial Companies. The committee will assess potential funding sources and mechanisms that could support credit growth.
The terms of reference also require the panel to examine differences in the cost of capital for businesses and suggest policy options that could encourage private investment and sustainable economic activity.
Technology will form an important part of the review. The committee has been asked to prepare a roadmap for artificial intelligence and digital innovation in banking institutions, while recommending safeguards against cybersecurity risks. It will also examine talent acquisition and workforce capacity-building requirements for the sector.
The committee will review the Priority Sector Lending framework and the Lead Bank Scheme. These mechanisms are intended to support credit access and financial inclusion, and the panel will assess their continued relevance, effectiveness and coordination in response to changing economic priorities.
The government's announcement does not introduce immediate changes to banking regulations or lending practices. Instead, it begins a six-month review process, after which the committee is expected to submit recommendations for consideration by the government.
The eventual impact will depend on the recommendations made and the policy or regulatory decisions taken after the review.
