India banks' bad-loan ratio falls to 1.73% in FY26; UPI hits record in October

Bad loans fell as a share of lending in every bank group

The ratio of gross non-performing assets (GNPAs) to gross advances measures how much of banks' lending is in or near default. Lower means healthier banks. For all scheduled commercial banks, the ratio fell to 1.73% in FY26, the financial year to March 2026. It was 2.22% in FY25 and 3.87% in FY23. The stock of gross non-performing assets fell to ₹3.86trn (trillion rupees) from ₹4.32trn. Gross advances grew about 15% to ₹223.5trn.

• Public sector banks: 1.93% (from 2.58%)
• Private sector banks: 1.47% (from 1.75%)
• Foreign banks: 0.56% (from 0.86%)
• Small finance banks: 3.09% (from 3.59%, still above the FY24 low of 2.43%)

State Bank of India's ratio fell to 1.49%. Its advances grew about 17%.

UPI set records for both volume and value in October

The Unified Payments Interface (UPI) is India's real-time mobile payments system. In October, it handled a record 25.47bn transactions, up 23% on the year. The previous high was 24.51bn in August. Value was a record ₹31.53 lakh crore, up about 16% on the year. UPI averaged 821.5mn transactions a day.

The rupee firmed against the dollar in early November

The Reserve Bank of India (RBI) reference rate put the rupee at 94.84 per US dollar on 4 November. That was firmer than 95.25 on 30 October and well off the 96.77 peak on 8 October. The RBI's overnight variable rate reverse repo auctions resumed on 3 November after a gap since 15 October. In these auctions, banks place spare cash with the central bank. The amount accepted was much smaller than on 7 October, which shows banks had less surplus cash to park.

Other payment systems also reported October totals

The Immediate Payment Service (IMPS), an instant bank-transfer system, handled ₹7.63 lakh crore in October. The Aadhaar-based government transfer system (NACH APBS) handled ₹64,627 crore.