Monetary policy plays a crucial role in shaping the growth and stability of the banking sector by influencing credit availability, interest rates, liquidity, and overall financial performance. This research paper examines the impact of monetary policy on the growth of the Indian banking sector, focusing on how policy instruments such as the repo rate, reverse repo rate, Cash Reserve Ratio (CRR), and Statutory Liquidity Ratio (SLR) affect bank lending, deposits, and profitability. The study analyzes the relationship between monetary policy adjustments and key indicators of banking performance, including credit growth, non-performing assets (NPAs), and capital adequacy ratios. Secondary data from the Reserve Bank of India (RBI), annual reports of scheduled commercial banks, and other financial publications are used to assess trends over the past decade. The findings are expected to highlight how expansionary and contractionary monetary policies impact liquidity management and credit flow in the economy. The paper also discusses policy implications and offers recommendations to enhance the responsiveness of banks to monetary signals. Ultimately, the study emphasizes that a well-calibrated and transparent monetary policy framework is essential for fostering sustainable growth, maintaining financial stability, and supporting the long-term development of the Indian banking system.