India currently has 12 Government (Public Sector) Banks, also known as Sarkari Banks. These include State Bank of India (SBI), Punjab National Bank (PNB), Bank of Baroda, Union Bank of India, Canara Bank, Indian Bank, Bank of India, UCO Bank, Bank of Maharashtra, Indian Overseas Bank, Central Bank of India and Punjab & Sind Bank.
Government banks play a vital role in the country’s financial system. Being owned and backed by the Government of India, they are a trusted choice for savings, loans and pension accounts. In 2025, public sector banks remain popular for their wide branch network, reliable services and government guarantee on deposits. This guide gives you the updated list of top government banks in India, highlights their strengths, recent mergers, and key differences to help you choose the right bank.
Here is the updated list of 12 Government Banks in India 2025 (Sarkari Banks) as per the Ministry of Finance.
These nationalised banks in India offer a wide range of banking services, from personal banking to business loans and government-backed schemes.
Below are the top 10 PSU banks in India 2025, ranked by their branch network. These government banks play a key role in providing banking services across cities, towns, and rural areas, ensuring financial inclusion and government-backed security.
| Best Government Banks | Market Capitalisation (₹ Crore) | Number of Branches |
|---|---|---|
| 1. State Bank of India (SBI) | ₹7,73,541 Cr | 22,980 |
| 2. Punjab National Bank (PNB) | ₹1,26,491 Cr | 10,209 |
| 3. Canara Bank | ₹1,09,882 Cr | 9,861 |
| 4. Union Bank of India | ₹1,04,298 Cr | 8,649 |
| 5. Bank of Baroda | ₹1,31,622 Cr | 8,426 |
| 6. Indian Bank | ₹97,614 Cr | 5,909 |
| 7. Bank of India | ₹54,450 Cr | 5,304 |
| 8. Central Bank of India | ₹33,237 Cr | 4,552 |
| 9. UCO Bank | ₹37,769 Cr | 3,302 |
| 10. Bank of Maharashtra | ₹42,519 Cr | 2,641 |
These nationalised banks in India play a vital role in the country’s economy, offering essential financial services to individuals, businesses, and rural communities.
Also read: List of Top Private Banks in India
Whether you need a savings account, business loan, or digital banking solutions, these banks cater to different needs. Below is a detailed overview of the best government banks in India, highlighting their strengths and market presence.
SBI is India's largest government bank, with over 45 crore customers and an extensive network of branches and ATMs. As one of the top public sector banks in India, it leads in retail, corporate, and digital banking services. The bank is a key player in implementing government-backed financial initiatives like the Jan Dhan Yojana and Mudra Loans.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| 10.01 | 66.12 | 368.39 |
PNB is one of India’s oldest and most trusted government banks offering a wide range of banking services with focus on business financing. The bank offers the best interest rates on business loans, MSME funding and agricultural loans, making it a preferred choice for small businesses and farmers.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| 2.66 | 215.36 | 278.21 |
Canara Bank is one of the best bank in India in digital banking among public sector banks, with a user-friendly mobile banking app, UPI services and advanced Internet banking. The bank has introduced AI-powered chatbots to help customers and resolve queries faster.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| 8.81 | 181.2 | 577.52 |
Union Bank of India is one of the government banks in India and is actively involved in financial inclusion initiatives. They provide easy access to government schemes like Pradhan Mantri Awas Yojana (PMAY), Jan Dhan Yojana and various agricultural finance options.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| 11.29 | 213.01 | 453.16 |
Bank of Baroda is one of India’s largest public sector banks, with a presence in over 20 countries. They have special services for NRIs, forex transactions and global business banking. They are also innovators in digital banking and provide a seamless experience through mobile and internet banking.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| 2.71 | 99.7 | 515.53 |
Indian Bank has a strong presence in semi urban and rural areas, offering savings accounts, agri loans and microfinance solutions. It has actively promoted government-backed financial literacy programs and small business financing.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| 38.29 | 273.46 | 1175.88 |
Bank of India has a good reputation for corporate banking, offering various financial solutions for big businesses and industries. It offers trade financing, project loan and investment banking services, so a preferred partner for corporate clients.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| 8.14 | 148.13 | 189.24 |
Central Bank of India is a pioneer in financial inclusion, offering affordable banking services to lower-income groups. It has introduced various zero-balance savings accounts, low-interest loans, and priority sector lending schemes. The bank has a strong rural presence, ensuring that even the most remote areas have access to formal banking services.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| -37.58 | 85.92 | 132.41 |
UCO Bank is good for MSME loans, startup funding and business loans. The bank is also into forex services so good for international business. Its growing digital presence has attracted tech savvy users looking for online convenience.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| -37.56 | 156.34 | 144.88 |
Bank of Maharashtra has a strong foothold in India's western and central parts. It offers regional banking solutions tailored for local businesses, self-employed individuals, and rural communities. The bank is known for its personalized customer service and localized financial products.
Returns:
| 1Y Return (%) | 3Y Return (%) | 5Y Return (%) |
|---|---|---|
| -8.31 | 216.79 | 391.38 |
After 2020, six government banks were merged into larger public sector banks in India. This was part of the government’s banking reform plan to improve efficiency and reduce costs. Below is the full list of government bank mergers since 2020:
| Merged Banks | Merged Into |
|---|---|
| Oriental Bank of Commerce & United Bank | Punjab National Bank (PNB) |
| Andhra Bank & Corporation Bank | Union Bank of India |
| Syndicate Bank | Canara Bank |
| Allahabad Bank | Indian Bank |
After these mergers, the number of PSU banks in India reduced from 27 to 12, making the banking system stronger, more efficient, and easier for customers to access services across the country.
Also read: List of Top Private Banks in India
Choosing the right government bank in India depends on your financial needs, banking habits, and the services you value most. While all PSU banks are government-backed and reliable, each has unique strengths that may suit different users.
Government banks in India are public sector banks where the Indian government owns a majority stake, also called PSU banks or Sarkari Banks. They operate under the Ministry of Finance and RBI rules, providing banking access to urban and rural customers.
These banks play a vital role in financial inclusion by offering savings accounts, loans, fixed deposits, and welfare-linked schemes. They also support farmers, small businesses, and students through various government programs.
India’s banking sector includes several types of banks catering to different needs:
Also Read: Best Banks in India
When deciding between government banks and private banks in India, it's important to understand the key differences in terms of stability, customer service, digital features, and loan approvals. Here’s a detailed comparison:
| Factor | Government Banks | Private Banks |
|---|---|---|
| Ownership | Majority-owned by the Government of India | Owned by private shareholders and investors |
| Interest Rates | Competitive but sometimes slightly lower | Slightly higher, more flexible based on market rates |
| Customer Service | Slower response times, longer queues at branches | Faster response time. |
| Digital Banking | Improving steadily but still catching up with private players | Advanced digital platforms and mobile-first approach |
| Loan Approvals | Slower due to stringent verification processes | Faster loan disbursals with flexible eligibility criteria |
| Trust & Stability | Highly secure and backed by the government | Stable but performance-dependent stability |
Government banks are best for those looking for long-term security and lower fees, while private banks excel in fast service and digital innovation.
The largest government bank in India is the State Bank of India (SBI), with over ₹7 lakh crore market capitalisation and nearly 45 crore customers as of 2025. SBI is not only India’s oldest public sector bank but also the most trusted name in the banking sector.
It offers a wide range of services like savings accounts, loans, digital banking, and corporate finance across urban and rural areas. With more than 22,000 branches and 62,000 ATMs, it has the largest physical network among all banks in India.
Also Read: Best Banks in India
There are 12 government banks in India as of 2025. These banks are also called public sector banks (PSBs), where the Indian government holds more than 50% ownership. Earlier, there were 27 government banks in the country, but after multiple mergers between 2017 and 2020, the total number came down to 12.
This move helped in improving the efficiency, reducing costs, and making Indian public banks stronger. All these 12 banks now play a key role in supporting government schemes, rural banking, and digital inclusion across the country.
Government banks not only offer reliable banking services but also provide strong investment opportunities through their publicly traded shares.
Here’s a list of the top 5 government banks in India based on their 5-year stock returns:
| Bank Name | Current Market Price (CMP) ₹ | 5-Year Return (%) |
|---|---|---|
| Indian Bank | ₹724.70 | 1175.88 |
| Canara Bank | ₹121.14 | 577.52 |
| Bank of Baroda | ₹254.52 | 515.53 |
| Union Bank of India | ₹136.63 | 453.16 |
| Bank of Maharashtra | ₹55.28 | 391.38 |
Among the best-performing PSU banks, Indian Bank and Bank of Maharashtra have delivered exceptional returns to shareholders, making them attractive options for long-term investors looking at public sector banks in India.
Also read: Best Banks in India 2025
Government banks remain the backbone of India’s financial system, combining trust, affordability and wide reach under one roof. In 2025, these public sector banks will not only provide savings and loan services but also upgrade digital platforms and customer support to match changing needs. By understanding the strengths of the top government banks in India and comparing interest rates, digital features and branch access, customers can choose a bank that fits their financial goals while enjoying the assurance of government backing.
The best government banks in India include the State Bank of India (SBI), BOB, Canara Bank, Union Bank of India, and Punjab National Bank (PNB). SBI leads in size and digital banking, while BOB and Canara Bank show strong growth in service quality.
As of 2025, there are 12 public sector banks in India. This number decreased from 27 after the 2020 mergers aimed at creating larger, financially stronger institutions.
Central government banks refer to public sector banks where the Indian government holds a majority ownership. These banks are regulated by the Reserve Bank of India (RBI) and include SBI, PNB, Bank of Baroda, Canara Bank, and Union Bank of India.
Semi-government banks are institutions where the government holds a partial stake, but they are not classified as fully public sector banks. Some cooperative banks and regional rural banks (RRBs) fall under this category, as they receive government support but also function with private involvement.
The State Bank of India (SBI) is the largest government bank in India. SBI has the highest market capitalization, a vast customer base of over 45 crore, and an extensive network of 22,700+ branches and 65,000+ ATMs.
Government banks offer several advantages over private banks, making them a preferred choice for many customers. Public sector banks provide higher stability, as they are backed by the government, ensuring customer deposits remain safe. They also charge lower fees on banking transactions and offer affordable interest rates on loans.
Disclaimer: This article is intended for educational purposes only. Please note that the data related to the mentioned companies may change over time. The securities referenced are provided as examples and should not be considered as recommendations.
