Performance Evaluation of Indian Banking Financial Sector by Using DEA Approach

New approaches that give data beyond what can be obtained from a formal analysis of financial statements are needed to measure and evaluate the effectiveness of the bank’s operations. A mathematical programming approach called Data Envelopment Analysis (DEA) identifies inefficient banks while considering the breadth of the services offered and the resources required to supply these banking services. Based on cross-sectional data from the top 10 nationalized banks for the period of April 2018–April 2022, this study aims to evaluate intra-sector performance in the Indian banking system. This study uses a DEA method to assess the relative effectiveness of a group of Indian banks in the real world. Finally, the bank is ranked using CRS and VRS models based on input and output financial ratio values. The investigation will highlight the banks that function effectively, areas where bank efficiency is not up to par, and probable causes of inefficiency.