The finance ministry has directed public sector banks to explore quantum-resistant encryption as an added security layer under this year's innovation and security initiatives, according to reports from The Economic Times. The hackathon theme to be pursued by PSBs in 2026 will be 'Cybersecurity and Fraud' and is part of the government's 'Aatmanirbhar Bharat' push in cybersecurity. This directive comes as experts warn that quantum computing could become so powerful over the next few years that it will be able to break the most sophisticated of encrypted systems within seconds. 'Q-Day', the point at which quantum computers can break current cryptography, is projected to arrive as early as 2029, with broader consensus pointing to the mid-2030s.
According to industry estimates reported by The Economic Times, India's banking and telecom sectors may need to spend up to ₹2,000 crore each over the next five to seven years to upgrade their cybersecurity and computing infrastructure and make them quantum-ready. This substantial investment reflects the scale of the technological transformation required to protect against quantum computing threats. The mandate presents significant operational and financial hurdles for PSBs, as replacing encryption embedded in systems like apps, payment networks, ATMs, cloud infrastructure, and data centers is a complex, multi-year task. The investment burden is particularly challenging for PSBs whose profitability metrics, such as ROE, are generally lower than private sector peers, with UCO Bank's ROE at approximately 8-9%.
India has set aside ₹6,003.65 crore for its National Quantum Mission (NQM), which will aim to build a 2,000-km quantum communication network by 2030-31, as reported by The Economic Times. The mission has already demonstrated a 1,000-km secure communication network, showcasing indigenous technological advancements. Ajai Chowdhry, chairman of EPIC Foundation and Mission Governing Board, National Quantum Mission, indicated that 'Q-Day' is now looking like 2029 and the NQM has created a plan for organisations to become quantum-secure. The mission has established a task force with a migration roadmap to guide the transition process.
Punjab National Bank is pursuing 'Quantum-Proof Systems for Public-Facing Applications' in 2026 to safeguard its digital financial infrastructure, according to The Economic Times. State Bank of India, the country's largest lender with a market capitalization nearing ₹1 trillion, is partnering with the Indian Institute of Technology, Jodhpur, on tackling fake mobile apps distributed through WhatsApp and SMS that lead to phishing and financial fraud. Kolkata-based UCO Bank is developing a real-time, audio forensics module that analyses the spectrogram of a live call to detect fraudsters cloning a customer's voice. Quantum-resistant encryption can help banks protect customer records, payments, ATM networks, mobile apps and inter-bank communication.
Regulators in the US, Europe and the G7 want banks to start tightening security of their computing infrastructure now, with many targeting critical systems by 2030 and full migration by 2035, as reported by The Economic Times. Large lenders such as JPMorgan Chase, Goldman Sachs, Barclays, HSBC and payment firms like Mastercard are already testing quantum-safe encryption to protect customer data and payments. The global race for quantum readiness highlights the importance of post-quantum cryptography (PQC) for protecting sensitive data and transactions. A report by Citi Bank puts the loss to the US economy at up to $3.3 trillion in indirect impact at just one of the large banks, highlighting the global scale of the quantum computing threat to financial systems.
