Public Sector Banks Now Competing on Par with Private, Foreign Banks: Piyush Goyal

New Delhi, December 23: Union Minister for Commerce and Industry Piyush Goyal on Monday said public sector banks have emerged as strong and competitive institutions, now operating on an equal footing with private and foreign banks, and playing a critical role in supporting India’s growth, particularly through credit expansion to micro, small and medium enterprises.

Addressing the MSME Banking Excellence Awards in New Delhi, Goyal said it was encouraging to see public sector banks standing shoulder to shoulder with private and foreign peers in extending institutional finance and supporting entrepreneurship across the country. He underlined that timely and adequate access to credit has been central to the growth of MSMEs, enabling small entrepreneurs to start businesses, expand operations and improve livelihoods.

Highlighting policy initiatives aimed at strengthening MSME financing, the minister referred to schemes such as Mudra and PM SVANidhi, which have helped bring small borrowers into the formal credit system. He noted that nearly 70 per cent of Mudra loans have been extended to women entrepreneurs, while the PM SVANidhi scheme has helped street vendors access affordable credit and move away from exploitative moneylenders.

Goyal also referred to the announcement of the India–New Zealand Free Trade Agreement earlier in the day, calling it the seventh free trade agreement concluded under the leadership of Prime Minister Narendra Modi. He said India’s recent FTAs reflect a strategic shift towards partnerships with developed economies offering complementary strengths and long-term business opportunities.

He emphasised that India’s FTAs today go beyond conventional market access, incorporating technical collaboration and investment commitments to support innovators, farmers and entrepreneurs. Referring specifically to the India–New Zealand pact, Goyal said New Zealand has made a binding commitment to invest USD 20 billion in India over the next 15 years, a sharp increase compared to the USD 70 million invested over the past 25 years. The agreement, he added, includes enforceable provisions to withdraw concessions if investment commitments are not met.

The minister said the FTA is expected to boost innovation, manufacturing and exports, with India emerging as a manufacturing base not only for New Zealand but also for global markets. He noted that MSMEs are expected to be the biggest beneficiaries and called upon stakeholders to work together to significantly scale up bilateral trade in goods and services.

Goyal also highlighted the role of women in India’s growth story, noting that the India–New Zealand FTA was negotiated by a team that was almost entirely women officers, with India’s ambassador also being a woman.

Touching upon broader economic trends, the minister said India is viewed globally as a trusted partner offering democracy, rule of law and policy stability. He noted that banks recorded profits of around ₹3 lakh crore last year, demonstrating their capacity to lend, while MSME credit has grown at a compound annual growth rate of about 14 per cent in recent years.

Calling MSMEs and banks “inseparable twins”, Goyal urged banks to lend liberally and responsibly, ensure speedy and transparent loan disbursements, and proactively guide MSMEs in accessing government schemes and capital markets. He said the strength of the MSME sector would ultimately determine India’s growth trajectory as the country works towards the vision of Viksit Bharat 2047.

Congratulating the award winners, the minister extended his best wishes to bankers and financial sector representatives for 2026, calling for faster, inclusive and sustainable growth during the Amrit Kaal.