Sitharaman Asks PSBs To 'Be Cool' To Connect With Gen Z, Offer Simpler, Personalised Banking

Finance Minister Nirmala Sitharaman has asked public sector banks (PSBs) to step up their engagement with young Indians through a focused, month-long campaign beginning October 2, saying banks need to better understand youth expectations and build relationships that extend beyond simply opening their first account.

Addressing the concluding session of the two-day PSB Confluence 2026, Sitharaman said the campaign should target citizens aged 16 and above and help PSBs establish a sustained connection with customers as they move through education, employment, entrepreneurship, investment and wealth creation.

The Finance Minister wants the broader approach to move from a one-time account-opening exercise towards a relationship spanning "campus to career and beyond".

'Cool' Banking Without Compromising Prudence

Sitharaman noted that public sector banks continue to be perceived differently from private lenders by many young customers and urged them to engage directly with youth to understand what they expect from banking services.

"Somewhere, private banks seem to have that picture of being banks, but good enough as well... I need public sector banks not to be not cool. You should, please get some young people to talk to you. What makes you appear cool? Or at least one portion of your banks should, when they sit in front of the customers, make sure everything is cool," Sitharaman said.

She said PSBs must keep pace with expectations for simple, intuitive, personalised and round-the-clock banking while maintaining the prudential standards expected of financial institutions.

"Public Sector Banks must be the first and most trusted choice of young Indians, whether they are opening their first account, receiving their first salary, pursuing higher education, starting an enterprise or making their first investment. You should be a part of their lives," the FM said.

Campaign To Reach Campuses, Youth Hubs

According to a statement by the Finance Ministry, the outreach would be coordinated through the Indian Banks' Association (IBA), with colleges, universities, skill institutions and other campuses identified as important points of engagement.

The 12 PSBs have been asked to develop their own strategies based on their products, regional presence and institutional strengths.

The Ministry has envisaged a common online portal or application that could serve as a single access point for information on banking services and opportunities related to education, skilling and entrepreneurship.

Sitharaman also suggested dedicated youth-focused spaces at branches, such as 'Yuva Kiosks' or 'Yuva Banking Mitra', to help young customers navigate their financial journey.

Banks were also encouraged to improve awareness around credit scores, formal credit products and government schemes.

Sitharaman suggested exploring learning content and lifestyle-linked benefits to deepen engagement with younger customers.

The Finance Ministry said the Confluence also produced actionable strategies across seven themes, including deposit mobilisation, support for the investment cycle, global capability centres, agriculture and horticulture value chains, credit cards and priority sector lending.

PSBs and financial institutions will now be expected to take these proposals forward through follow-up action with clear ownership and realistic timelines.

PSBs Urged To Be Competitive

Beyond youth banking, the Finance Minister said PSBs and public financial institutions should convert their institutional strengths into greater competitiveness and leadership.

She pointed to their large customer base, extensive branch networks, geographical reach, institutional experience and expanding digital capabilities.

"Our Banks and Financial Institutions should help shape, finance and enable the vision of Viksit Bharat," Sitharaman said.