Financial sustainability has become a catch line in the modern financial systems. This has become a matter of concern in all economies worldwide. Financial sustainability ensures stable and resilient financial health. This comprehensive approach supports the banking sector in generating more revenue, and its strategic planning system is conducive to reducing the level of non-performing assets by managing costs. This allows the financial system to achieve its strategic goals by effectively managing borrowing and credit. Strategic investment decisions help evade financial strain and mitigate probable financial pitfalls. This makes the system more viable and resilient, allowing banks to achieve long-term goals in a zestful environment of financial threats and opportunities. The concept of financial sustainability is a new term in the Indian banking system. Banks are trying their best to adopt and implement it, but are still lagging. To date, only a few banks have incorporated them successfully. Financial sustainability offers many benefits to banks in the form of high productivity, effective management of interest rate fluctuations, controlled non-performing assets, cost reduction, better customer satisfaction, and risk control. Indian banks have acknowledged the significance of financial sustainability and are now committed to achieving it. Banking regulators must incorporate and implement the goal of financial sustainability in the Indian banking system on a priority basis. This study highlights the need to adopt the goal of financial sustainability in the Indian banking industry. Further, the strategies made by the RBI in this direction have been analyzed along with the challenges that banks face during the implementation of these strategies in the real world.