Speaking at a State Bank of India (SBI) event in New Delhi, he said India is seeing "the replacement of a cash dominated economy with a more formal and digitised economy. One of the great changes will be the way India spends its money".
The move towards digitisation was expedited post demonetisation of higher denomination currency notes, he said.
"Today we are passing through a changing process for the Indian economy. Ten to twenty years later when the era is written about, it will be talked of as a phase with much faster formalisation of the economy," Mr Jaitley said.
In the last one year, he said, money flow into insurance, mutual fund and IPOs has increased.
On SBI, Mr Jaitley said the lender accounts for 20-25 per cent of all banking activity and is one of the largest banks in world after amalgamation with subsidiaries.
"It has managed to retain its performance as a highly professional institution," he added.