The study seeks to explore the dynamics of monetary policy transmission and its impact on banking sector profitability in India for the post-pandemic period, a phase characterized by substantial changes in liquidity conditions, interest rate cycles, and financial sector reforms. The importance of this research can be understood by its contribution to knowledge regarding the impact of policy rate changes by the RBI on banking sector profitability through various channels of monetary policy transmission in a post-pandemic economic environment. Although a considerable amount of literature has been devoted to studying various channels of monetary policy transmission for pre-pandemic periods, there has been a scarcity of research focusing on the post-COVID economic environment characterized by external benchmark-based lending rates, digitalization, and changing liquidity conditions. Therefore, this research aims to explore the efficiency of monetary policy transmission and its impact on key profitability indicators of banks such as net interest margin and return on assets. The research follows an empirical approach using panel data from selected Indian banks for the post-pandemic period. It uses econometric methods to estimate the relationship between policy variables and bank performance. The results show that there is a significant improvement in transmission efficiency in the post-pandemic period. It takes less time to adjust the lending rates, resulting in higher short-term profitability. However, there are challenges in sustaining the margins due to increasing deposit costs. The results show that monetary tightening helps banks improve their profits, but policymakers need to improve the transmission mechanisms for the banking sector.