India’s ambition to achieve a $30 trillion GDP by 2047 will require a 20 times growth in the financial services sector, with banks playing a pivotal role, according to a BCG report.

As a predominantly bank-led economy, India will require the banking sector to play an anchor role while the other financial asset classes continue to grow much faster, per the report “Banking for a Viksit Bharat” released at the annual FICCI-IBA Conference.

“This will require $4 trillion of capital base in banks, 1/3rd of which will have to be fresh capital deployment. India’s banking system is in a strong position today – characterised by high profitability, robust capital adequacy, and low levels of non-performing assets (NPAs),” the report said.

Ruchin Goyal, Managing Director and Senior Partner at BCG and Co-author of the report, observed that India’s journey towards a $30 trillion economy by 2047 is an ambitious yet achievable goal. It demands a transformation in the financial services sector, with banks at the forefront.

“India’s banking system is in a strong position today, acting as a launchpad for the Viksit (developed) Bharat mission. It will have to build for the next two decades through structural shifts – growing deposits, enhancing asset quality, and improving productivity, while advancing digital capabilities and future competencies,” he said.

MV Rao, Chairman of the Indian Banks’ Association, emphasised that one of the banking industry’s primary objectives is to ensure financial inclusion, creating opportunities for every individual to grow and contribute to the nation’s progress.

“To fuel inclusion and credit growth, we must continue to innovate and reimagine our deposit strategies, aligning them more closely with our customers’ evolving needs and preferences. This growth will be aided by our workforce’s full potential, which must be harnessed using digitisation and emerging technologies like GenAI,” Rao said.

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