Published: 30 January 2026PIB / IBEFEconomy
Economic Survey: Banking Sector NPA at Multi-Decadal Low of 2.2%; Credit Growth at 14.5%
The Economic Survey 2025-26 highlights the robust health of India's banking and financial sector. Scheduled Commercial Banks' (SCB) Gross Non-Performing Asset (GNPA) ratio fell to 2.2% in September 2025 — a multi-decadal low. Net NPA ratio reached a record low of 0.5%. The Capital to Risk-Weighted Assets Ratio (CRAR) remained robust at 17.2%, well above regulatory requirements.
SCB credit growth strengthened to 14.5% YoY as of December 2025, the highest in FY26, compared to 11.2% in December 2024. Personal loans recorded the highest growth at 12.8% in November 2025, driven by a sharp rise in loans against gold jewellery.
Total financial sector assets reached 187% of GDP in CY 2024. Capital markets expanded from 144% of GDP in CY 2017 to 175% in CY 2024. Demat accounts added in FY26 (till December) were 235 lakh, taking the total beyond 21.6 crore. Unique investors exceeded 12 crore by September 2025, with nearly 25% being women. Mutual fund unique investors reached 5.9 crore.
Financial inclusion achieved significant milestones: Pradhan Mantri Jan Dhan Yojana (PMJDY) reached 55.02 crore accounts by March 2025. Under PMMY (Mudra Yojana), ₹36.18 lakh crore was disbursed across 55.45 crore accounts by October 2025.
0Mains angle
Q: Assess the robustness of India's banking and financial sector as highlighted by Economic Survey 2025-26 and discuss the role of PMJDY and PMMY in advancing financial inclusion.
Answer (50 words):
Economic Survey 2025-26 reports India's banking GNPA at a multi-decadal low of 2.2%, Net NPA at a record 0.5%, and credit growth at 14.5% (December 2025). Capital markets expanded to 175% of GDP; unique investors exceeded 12 crore. PMJDY reached 55.02 crore accounts; Mudra Yojana disbursed ₹36.18 lakh crore.
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Linked questionMedium
The Payments Regulatory Board (PRB) replaced which earlier body under RBI?
Explanation · Correct answer BThe PRB replaced the BPSS, constituted under the Payment and Settlement Systems Act, 2007 (amended).
Frequently asked questions
What does Economic Survey 2025-26 say about India's banking sector NPAs?
The **Economic Survey 2025-26** revealed India's banking sector is in its healthiest state in decades: **Gross NPAs declined to 2.2%** (September 2025) and **Net NPAs stand at just 0.5%**. Bank credit growth accelerated to **14.5% year-on-year**.
How many new jobs were created in India between Q1 and Q2 of FY26?
**8.7 lakh new jobs** were created between Q1 and Q2 of FY26, taking total employment to **56.2 crore persons**. Chief Economic Adviser **Dr. V. Anantha Nageswaran** stated India has the potential to reach a **7.5% growth rate**.
What was India's services exports figure as per Economic Survey 2025-26?
India's **services exports hit USD 387.6 billion** in FY25, registering **13.6% growth** — an all-time high. The Survey, released on **January 29, 2026**, described India as transitioning towards a high-growth and resilient economy, with FY26 real GDP growth at **7.4%** and April-December 2025 inflation at **1.7%**.
What does the Economic Survey 2025-26 say about India's growth and inflation outlook?
The Economic Survey 2025-26 described India as moving towards a **high-growth and resilient economy** — characterised by **high growth (7.4%)** and **historically low inflation (1.7%)**. This combination of robust expansion without excessive price pressure reflects strong underlying economic conditions for India.
What is India's Net NPA ratio and what does it indicate about bank health?
India's **Net NPA ratio stands at 0.5%** as of September 2025 — an exceptionally low level indicating very strong bank balance sheets. Combined with **Gross NPAs at 2.2%**, this is the lowest in over a decade and reflects effective resolution of stressed assets through the **IBC framework** and improved credit monitoring.
