India’s public sector banks (PSBs), the backbone of the country’s financial system, are facing a paradox in 2025: while their branch networks continue to grow, their employee numbers are steadily dwindling. This trend is sparking alarm among bank unions, industry experts, and customers alike, as the sector grapples with the twin challenges of digital transformation and human resource management.
Recent data paints a clear picture of the decline. Major PSBs such as Bank of India, Canara Bank, Bank of Baroda, and UCO Bank have all reported a consistent drop in staff headcount over the past three years:
Bank of India: From 52,374 employees in FY23 to 50,564 in FY25
Canara Bank: From 84,978 in FY23 to 81,260 in FY25
Bank of Baroda: From 76,513 in FY23 to 73,742 in FY25
UCO Bank: From 21,698 in FY23 to 21,049 in FY25
While State Bank of India (SBI) and Punjab National Bank (PNB) have shown minor fluctuations or slight increases, the overall trend across the sector is unmistakably downward.
In FY24 alone, India’s PSBs collectively reduced their employee count by over 11,000, with most cuts occurring at the associate and clerical levels. Over the past decade, the total number of clerks at PSBs dropped from 3,98,801 in 2013 to 2,46,965 in 2024, while private banks have seen their workforce surge dramatically in the same period.
Increased automation and digital banking services have reduced the need for manual intervention in routine tasks such as query handling, collections, and cash management. Many functions that once required multiple staff are now handled by machines or digital platforms.
With rising operational costs and pressure to boost profitability, banks are streamlining their workforce, especially at the lower levels.
Some banks are focusing more on hiring for digital and specialized roles, while reducing intake for traditional clerical and associate positions.
Natural attrition, retirements, and slower replacement rates have contributed to the shrinking workforce.
Bank unions are vocal in their demand for more hiring, especially at the clerical level, citing the massive customer loads PSB employees handle compared to their private sector peers. The United Forum of Bank Unions (UFBU) has even called for strikes to draw attention to staffing shortages and other unresolved issues.
The finance ministry has urged state and union territory officials to ensure uninterrupted public service, especially in the wake of reports about customer frustration and even incidents of abuse against overworked bank staff.
As India’s banking sector continues its digital evolution, finding the right balance between technology and human resources will be critical. While automation can boost efficiency, the human touch remains vital for trust, relationship management, and complex problem-solving.
