Does Banking Behaviour Differ by Occupation? A Contextual Investigation

Abstract

Besides providing access to financial services, the basic objective of financial inclusion programme is to develop banking awareness and positively influence the banking behaviour of various sections of society that remain excluded from the formal financial system. The mega financial inclusion programme of India, 'Pradhan Mantri Jan-Dhan Yojana' (PMJDY), provides the context to study the financial and banking behaviour of two major sections of society namely the self-employed and the service holders. In this research, important issues like (i) product and service awareness (ii) effective usage of technology (iii) banking behaviour and others have been compared between the two groups, i.e., service holders and the self-employed. This study finds that the financial inclusion programme has impacted the two occupation groups differently. Self-employed people were assumed to have higher level of awareness, behaviour and usage of technology related to banking, but it is the service holders who indicated higher levels of response in most of the banking parameters. The study suggests that education and self-employment context in rural areas could be the reason for lower level of acceptance and usage of banking services. There seems to be a need for occupation specific banking orientation, and usage programme. Policy success would actually depend on higher level of acceptance by all occupation groups. The study suggests that education moderates awareness about banking products and habits related to banking. The financial inclusion programme has prompted people to open bank accounts because there was no money required to open such an account and this has positively impacted their savings habits. The duration of banking service usage also could influence the usage and gradual spread of effective financial inclusion.