An Analytical Study on Digital Banking Evolution and Its Impact on Customer Trust in Modern Indian Banking Sector

Abstract The success of the digital initiatives is heavily dependent on customer trust, which remains a critical factor for adoption and sustained engagement. Through a mixed-method approach based on primary data from 500 respondents and supported by secondary data from reputable sources, the study explores patterns of digital usage, customer satisfaction, and trust differentials across public and private sector banks. Statistical tools such as Pearson’s correlation and t-tests were applied to test the hypotheses. The results reveal a significant positive relationship between digital usage and trust, and a clear trust gap favoring private banks over public banks. The study also identifies key demographic influences on trust and emphasizes the need for banks to invest in customer education, cyber security, and user-centric service design. The findings underscore that trust in digital banking is a multidimensional construct shaped by both technological effectiveness and human interaction. The study offers valuable implications for policy-makers and banking institutions aiming for inclusive and sustainable digital growth.