In the past decade, there has been a notable rise in the utilization of online banking services. However, apprehensions regarding risk remain a significant barrier to widespread acceptance, especially when comparing public and private sector banks. This study explores the impact of perceived risk on the adoption of online banking, focusing on security, privacy, financial, performance, and time-related risks. By conducting a comparative analysis of public and private sector banks, the research illustrates how customers perceive these risks differently, influencing their decision to embrace online banking. Public sector banks are perceived as more secure due to government backing, resulting in reduced concerns about security and financial risks among customers. However, they grapple with worries about performance and time risk due to slower technology adoption. Conversely, private sector banks, being more technologically advanced, face heightened concerns about privacy and security, despite offering superior user experiences and faster transactions. The findings from the research indicate that public sector banks can capitalize on increased trust but need to upgrade their technological infrastructure to encourage usage. On the other hand, private sector banks should prioritize establishing customer trust and transparency to address concerns about security and privacy risks. These results offer crucial guidance for banks to develop specific strategies to address perceived risks and promote broader online banking usage across different customer segments.