Green Banking in India: Examining Drivers, Practices, and Environmental Performance in Banking Sector

Green banking has emerged as an important strategy for promoting environmental sustainability alongside financial performance in the banking sector. This study examines the adoption of green banking practices in public and private sector commercial banks in India, focusing on their impact on environmental performance and sources of green finance. Drawing on Stakeholder Theory, Resource-Based View, Institutional Theory, and the Theory of Planned Behaviour, the study explores how regulatory pressure, stakeholder expectations, technological advancement, and organisational commitment influence the implementation of green banking initiatives. The findings indicate that practices such as paperless transactions, financing renewable energy projects, environmental risk assessment, and digital banking solutions significantly reduce environmental impact while enhancing operational efficiency. The study further reveals that government regulations, corporate social responsibility, market demand, technological innovation, and top management commitment are key drivers of green banking adoption. Additionally, green banking strengthens risk management, enhances corporate reputation, supports financial stability, and contributes to long-term profitability and sustainable economic growth. The study provides empirical evidence from the Indian banking context and highlights the critical role of financial institutions in achieving broader sustainability and development goals.