Financial Inclusion in India

An Analysis of its Pattern


  • T D Simon Department of Economics, Sree Keralavarma College, Thrissur, Kerala, India



Financial inclusion, financial exclusion, bank account, unbanking sections, socio-economic factors, government policies


Financial inclusion, the process of ensuring access to financial services along with timely and adequate credit where needed by vulnerable groups, helps the weaker sections and low-income groups in different ways. With an active intervention of the government, a large number of the unbanked segments of the society could be included in various financial services in the last few years. As a result, the number of bank accounts has been increasing. Members from the marginalised groups, women, etc. are some of the direct beneficiaries of financial inclusion. By utilizing micro data of World Bank, ‘Global Financial Inclusion (Global Findex) Database 2017, the author observes that socio-economic factors, like educational level, age group, and employment have an important role in determining one’s access to banking services. But some problems arise when the account holders do not utilize the banking facilities properly, especially when a majority stays idle. Lack of money is still considered one of the major factors for a lack of interest in holding a bank account. The ownership of bank account by other members in the same family also stops many from opening a bank account. The government has to take active measures to solve these issues. Moreover, the remaining unbanked sections of the society have to be included in the financial services, by solving the various reasons cited.


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