Challa Sreenivasulu Setty took over as chairman of State Bank of India, named best consumer bank, in August last year. He discusses SBI’s digital journey, the trajectory of its consumer banking business and the challenge posed by AI and fintechs.
Global Finance: State Bank of India (SBI), the country’s largest bank, reported strong returns in 2024. How did you achieve this and is it repeatable?
Challa Sreenivasulu Setty: Our strong performance for fiscal 2025 stems from a disciplined growth strategy, prudent risk management and the operation of our diversified portfolio. We have seen healthy credit growth across the retail, SME and corporate segments. Most importantly, we achieved these returns while improving asset quality, through strong underwriting, rigorous credit monitoring and turnaround efforts. We balanced loan portfolio expansion with strong, low-cost deposits, ensuring stable margins. This was supported by cost savings from digitalization. We are confident that these results are sustainable because they are based on the pillars of consistency, productivity and resilience. As the Indian economy continues to grow, we see opportunities for SBI to grow while preserving our financial position, technological edge and customer trust.
GF: What are the latest steps taken by SBI as part of its digital transformation?
Setty: SBI’s digital journey is led by our flagship product You Only Need One [YONO] platform, which offers both mobile and branch banking services.
YONO has surpassed 90 million registered users, with over 65% of savings account openings and over 40% of personal loans coming from digital sources. We also have 140 million registered users on our Retail Internet Banking platform, in addition to 7.2 million registrations on WhatsApp Banking, which is currently offered in six languages.
This scale demonstrates our success in promoting digital inclusion; we are bringing millions of customers, from urban millennials to rural users, to digital banking. Initiatives such as YONO Business, YONO Global, video-KYC integration and end-to-end loan processing are redefining convenience. The next phase is to integrate generative AI for hyper-personalization and predictive engagement, making digital not just a channel but the heart of our customer experience.
All these efforts underline SBI’s digital transformation journey. From an institution with over 200 years of heritage, we have reinvented ourselves as a forward-looking, digital-first bank.
GF: How is SBI improving customer experience in consumer banking? What role does AI play?
Setty: Improving the customer experience is at the heart of everything we do at SBI, driven by an unwavering customer obsession that shapes our decisions and priorities. To improve service quality, we measure customer experience using various metrics and simplify processes to reduce turnaround times. Our omnichannel and multilingual approach ensures seamless transactions across all platforms.
Using analytics and AI, we are moving towards an anticipatory customer service approach rather than simply providing generic offers as part of a reactive approach. Branches are being reimagined as advice centers while routine services are migrated to digital channels. Our mission to be the bank of choice is built on trust and built on delivering premium, personalized experiences at every touchpoint.
GF: Where do you see growth in the coming year for consumer banking and geographies served by SBI?
Setty: Domestically, SBI already has unrivaled reach, but we expect significant room for growth in consumer banking across India. Growth in consumer banking will come primarily from proactively meeting people’s changing needs as middle-income classes grow and corporate size creates new wealth and redistributive opportunities.
SBI’s retail personal loan portfolio has grown by 11-14% in the last few quarters due to strong growth in home loans. Credit to individuals, in particular real estate loans and personal loans, will remain our growth engines. We are also expanding into semi-urban and rural areas, supported by financial inclusion initiatives and government programs.
Internationally, we see potential in markets with significant Indian diaspora populations, and digital expansion through YONO’s global deployment allows us to serve geographies where we do not have a significant physical presence. We deepen our reach by selling more products per customer and expand it by entering new markets around the world.
This two-pronged approach gives us confidence that SBI will continue to grow vigorously, both domestically and abroad.