PSU Banks Are Seeing a Decline in Staff Headcount; Why Is It So?

According to a report by Business Standard, Public sector banks (PSU Banks) across India are witnessing a steady drop in staff strength over recent years, even as their branch networks continue to grow. The trend has sparked discussions and protests from bank unions and industry observers over its potential impact on banking services.

Staff Headcount Reduction Across Key PSU Banks 

Data compiled from the past three financial years show a noticeable decline in employee headcount across several public sector banks (PSBs).

• Bank of India saw its staff numbers fall from 52,374 in FY23 to 50,944 in FY24 and further to 50,564 in FY25.
   
• Canara Bank experienced a steady reduction, with figures moving from 84,978 in FY23 to 82,638 in FY24, and dropping to 81,260 in FY25.
   
• Bank of Baroda also followed a similar trajectory, with 76,513 in FY23, 74,227 in FY24, and 73,742 in FY25.
   
• UCO Bank showed a smaller but consistent drop from 21,698 in FY23 to 21,456 in FY24 and finally to 21,049 in FY25.

SBI and PNB Show Mixed Trends

Unlike other PSBs, State Bank of India (SBI) and Punjab National Bank (PNB) showed a more balanced picture.

• SBI, India’s largest PSB, initially dropped from 235,858 in FY23 to 232,596 in FY24, but then increased to 236,226 in FY25.
   
• PNB maintained near-stable staffing with 102,319 in FY23, 102,349 in FY24, and a slight decline to 102,316 in FY25.

These figures point to targeted recruitment or internal balancing by the two banks amid sector-wide staff concerns.

Branch Expansion Amid Staff Cuts

Interestingly, this fall in staff numbers has not impacted the expansion of branch networks. All major PSBs increased their branch presence in FY25. This divergence between rising infrastructure and falling manpower is being closely scrutinised.

Read More: After RBI’s Rate Cut, These 4 Public Sector Banks Cut Lending Rate – Find Out Which Ones! 

Union Concerns and Employee Protests

Several bank unions have voiced strong objections to the continuing fall in staff strength, linking it to increased pressure on existing employees and deterioration in customer service.

Reports highlight situations where some branches are operating with as few as two or three employees. Union representatives argue that such low staffing levels hinder daily operations and affect public service quality.

Protests by bank employees were held earlier this year in response to this growing concern.

Government’s Response and Safety Measures

In response to reported incidents of threats and abuse against bank staff, the finance ministry has directed state and union territory administrations to sensitise the public and ensure safe, uninterrupted services in bank branches.

There have been multiple reports of verbal and physical confrontations involving bank staff, adding urgency to the issue of understaffing and safety at bank premises.

Conclusion

The steady decline in staff headcount across several public sector banks raises operational concerns despite a growing physical presence. While some banks show marginal recovery or stability, the broader trend reflects a need for rebalancing between infrastructure growth and workforce support. Unions continue to demand attention to these issues, especially amid rising public interaction and pressure on banking services.

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