Impact of Digital Finance on Rural Households Financial Behaviour

Abstract

Villages are the backbone of India. Rural households constitute 70% of India’s population. Financial inclusions help rural households to open a bank account and encourage them to do more financial activities. Innovations in communications technology and mobile phone penetration in rural villages change rural households’ digital finance behaviour. The government has taken many initiatives to make rural households be digitally literate. Despite all the initiatives of the government, the rural house still lags behind. This study has taken rural households as the target audience to find out their digital financial behaviour with respect to savings, remittances, payments, credit and investments. A multi-stage stratified random sampling method is adopted to carry out the study. Rural households’ opinions are collected using structured questionnaires. The collected data is quantitatively analysed with the help of SPSS tools. The findings of this study revealed that financial behaviour traits are identified as a motivator, moderator and excluded. Security traits of digital finance transactions play a vital role in significant discrimination of different digital finance behaviours. Findings of Structural Equation Modelling reveal that the accessibility of various digital finance platforms can influence their digital financial behaviours in a broad way.