Financial Inclusion In India Research Articles

Financial Inclusion Indicators Affect Profitability of Jordanian Commercial Banks: Panel Data Analysis

Previous literature supports the view that the financial inclusion leads to economic growth and helps alleviate poverty; however, it is still unclear whether financial inclusion increases bank profitability. The study assumes that financial inclusion is significant in enhancing the economy and minimizing loan accounts, and along with this assumption, the deposit size decreases the Jordanian banks’ profitability despite the fact that the financial services and access to them have no significant influence upon such profitability. The major profitability drivers examined in this study comprised financial inclusion and financial leverage. In this study, 13 Jordanian banks’ data from 2009 to 2019 were examined to determine the above issue. The study applied fixed effects on a panel data regression model. The findings indicated that the number of loan accounts and size of deposits negatively and significantly impacted the profitability of the commercial banks in Jordan. However, the number of branches and ATMs had no significant effect on the bank’s profitability. In sum, both leverage and bank size were the top two determinants of commercial banks’ profitability in Jordan. Based on the findings, Jordanian policymakers can shift their focus to offering affordable financial services that support SMEs’ loans and start-ups.

A Study on Financial Inclusion in India and Its Relation with Financial Literacy

Finance has become a crucial part of our economy for development of the society. For this purpose, a solid economic system is required not only in developing and under-developed countries but also for developing countries for maintaining growth. Through financial inclusion we will achieve equitable growth of our country. Financial inclusion means providing appropriate products and services to weaker sections at a reasonable cost. Now day’s financial institutions provide complex sort of products. So it's difficult for the commoner to form choice among them. Therefore, literacy about financial products is required to form sound decisions. Financial Literacy isn't nearly markets and investing, but also savings, budgeting, financial planning, basics of banking and most significantly, about being "Financially Smart". Financial Literacy is considered important factor for promoting financial inclusion. Financial literacy is about enabling the commoner to know the varied needs and benefits of varied financial products and services provided by institutional players. During this paper, review of literature of monetary inclusion and financial literacy is provided. Various determinants of monetary literacy and its relationship with financial inclusion have also been reviewed and studied.

FINANCIAL INCLUSION IN NIGERIA: AN OVERVIEW

This paper analyses the level of financial inclusion in Nigeria using data from the global findex indicators. The findings reveal that Nigeria witnessed growth in several financial inclusion indicators in the early years of financial inclusion in 2014, but the benefits were not sustained in the later years, especially in 2017. Nigeria’s level of financial inclusion is very low compared to the World average. In the population group analysis, it was observed that the female, poorest, male, older and uneducated members of the population were worse- off in all indicators of financial inclusion in 2017. The implication of the observed decline in the level of financial inclusion in 2017 seems to suggest that there are barriers to financial inclusion in the post-2014 years.

Impact of digital financial infrastructure in furthering financial inclusion in India

Impact of digital financial infrastructure in furthering financial inclusion in India

Kisan Credit Card and its Impact on Financial Inclusion in India

Kisan Credit Card and its Impact on Financial Inclusion in India

Study of Fintech Revolution: A step towards Financial Inclusion in India

Study of Fintech Revolution: A step towards Financial Inclusion in India

Social Benefits of Financial Performance - an Econometric Analysis of Financial Management of Indian Microfinance Institutions (MFIs)

The microcredit facilities that are imparted by Microfinance Institutions (MFIs) to the low-income clientele, usually in the form of small loans for microenterprise and income-generating activities have been linked with increasing financial inclusion in India. This study explores the econometric relationship among the aggregate gross loan portfolio, operational efficiency and average number of active borrowers of MFIs in India with the understanding that financial exclusion renders the poor vulnerable to monetary shocks. It was observed that healthy aggregate gross loan portfolio (considered here as a proxy for asset position) and operational efficiency (ratio of administrative expenses to financial revenue) of an MFI does not hamper financial inclusion (number of active borrowers) in the society, rather better financial performance of MFIs improves the financial inclusion at the macro level. Hence, financial performance of an MFI does not come at the cost of social performance. The research paper further provides impetus to the policy makers in India to corroborate the MFIs with large asset values to efficiently allocate their resources to sustain a large number of borrowers.

Does financial inclusion affect economic growth A global perspective

This study aims to examine the impact of financial inclusion on economic growth in four different income groups from 2005-2020. A multidimensional index of financial inclusion was developed, and then this newly constructed index has been used to examine the effect of FI on economic growth. Financial inclusion indicators investigated in the present study include domestic credit from financial sector and private sector, number of commercial banks and ATMs per 1,000 km2 and 100,000 adults, borrowers and depositors from commercial bank. Gross domestic product per capita (GDPPC) is used as a measure of economic growth. In this study Stata software has been used to assess the impact of variables. According to the findings, in countries with low financial inclusion index (FII) and low income, financial inclusion has a positive significant impact on economic growth. Policymakers should design initiatives that increase access to and use of financial products.

Efekti finansijskog uključivanja na rast BDP - slučaj Severne Makedonije

Achieving higher financial inclusion is a target for each government today, committed to build an economy where everyone has easily accessible financial services, leading to higher economic growth. The aim of this paper is examining the relationship between financial inclusion, measured through a selected set of quantitative indicators (encompassing the penetration, availability and usage dimensions) as independent variables, and the economic growth, measured through the GDP per capita, as dependent variable. The research model applied was the multivariate regression model performed through the Ordinary least squares (OLS) method. The data sample consists of several financial inclusion indicators for North Macedonia and GDP per capita for the period 2007-2019. Findings revealed valuable information for the future strategies, institutional arrangements and measures to strengthen national capacities in function of improving the indicators having significant contribution to GDP growth and achieving higher financial inclusion. Also, findings provided theoretical contribution to the current research database for the specific case of North Macedonia.

A Study on APEC Policies to Enhance Inclusive Growth through Financial Inclusion

This study analyzes the discussion on financial inclusion for inclusive economic growth, discussed at APEC during 2010-2018. Financial inclusion, a way to increase access to finance with low financial costs, has been discussed for a long time as an international agenda for the financially underprivileged, such as women, the poor, and SMEs. The World Bank has developed financial inclusion indicators such as the Global Financial Inclusion Index and the IMF to provide financial data. In 2010, the G20 adopted the G20 Principles for Innovative Financial Inclusion and launched a global partnership for financial inclusion for concrete implementation. APEC has also been actively discussing financial inclusion, holding the Asia Pacific Financial Inclusion Forum every year since 2010. In particular, in the era of digital innovation, APEC Leaders discuss various ways to raise the financial understanding and financial knowledge of the underprivileged with the digital divide. The most controversial part of expanding financial inclusion is the relationship between financial inclusion and financial development. Financial inclusion has been chiefly approached from social policy rather than economic or financial policy. On the other hand, financial development sees finance as an industry that competes in the market. In APEC, the economic and social issues of financial inclusion and the logic of the market of financial development can be harmonized through regional cooperation. Eventually, ways to achieve inclusive growth can be achieved so that the marginalized class in member economies can be freed from poverty through building a sustainable financial inclusion ecosystem.

The determinants of Financial Inclusion and Digital Financial Inclusion in India: A Comparative Study

The access to the Önancial services and digital financial services in India has not yet transformed into their frequent use. Therefore, the present paper provides a comparative analysis of the individual level determinants for few main indicators of the two main dimen- sions of Önancial inclusion and digital Önancial inclusion: access and use, based on binary probit regression analysis using World Bankís 2017 Global Findex data. The paper concludes that education and workforce participation are positively associated with the access to Ö- nancial services and digital financial services and also with the use of most of the financial services and digital financial services. Another interesting result is that being a woman and poor reduces the probability of using mobile banking but do not a§ect traditional banking.

Inclusive Finance In Cooperatives For Community Empowerment Through MSME Development In The City Of Tarakan

Inclusive finance has an important role in alleviating poverty and reducing income disparities. One of the development priorities in the Government Work Plan (RKP) is the development of Micro, Small and Medium Enterprises (MSMEs). This is based on the fact that MSMEs have contributed a lot to the national economy. The development of Micro, Small and Medium Enterprises (MSMEs) is very strategic. One form of government support in developing MSMEs in Tarakan City is MSME capital support through cooperatives. Can every community, especially MSME actors, get the same access to Cooperative services or not and what are the implementations and implications of these institutions for community empowerment through MSME development.This study aims to (1) determine the supporting and inhibiting factors of inclusive finance for empowering farming communities through the development of MSMEs in Cooperatives in Tarakan City (2) Knowing and analyzing the implementation of inclusive finance for empowering farming communities through the development of MSMEs in Cooperatives in Tarakan City. The data analysis method used is descriptive qualitative according to Miles and Huberman. The results of the study show that (1) Financial inclusion in cooperatives in Tarakan City is implemented through a program of providing productive capital. The implementation of this cooperative program has been quite successful, but the performance of the program has not run efficiently. The indicators of financial inclusion in question are indicators of availability of access, indicators of use, and indicators of quality. (2) The implications of financial inclusion show a positive movement in value where most of the recipients have felt the benefits and changes in economic conditions. For those who previously had a business, they felt that there was an increase in income, and for those who started a new business, they felt that there was an increase in economic capacity, although it was not too significant. So, the implications of inclusive finance for Cooperatives in Tarakan City have been able to create empowerment for the community, although not yet significantly.Keywords: Inclusive Finance, Empowermen, Cooperatives

Performance of microfinance institutions during the COVID-19 pandemic: evidence from Indian states

The microfinance sector has played a vital role in economic development and financial inclusion in India. However, with the COVID-19 pandemic affecting economic activities, microfinance institutions (MFIs) were impacted adversely. The Government of India introduced a moratorium to borrowers for loan repayments. This study examines the impact of the government’s initiative of easing borrowers’ financial burdens and the number of active COVID-19 cases on the operational efficiency of MFIs in Indian states. Additionally, the analysis explores the macro-economic determinants of MFI performance. The study incorporates the random effects robust regression model. The findings suggest that interest rate and inflation impact every MFI performance criterion while national income only affects the loan penetration efficiency of MFIs. It is also found that the moratorium significantly helped borrowers, whereas, it had adverse effects on the loan penetration by MFIs. Lastly, it is shown that MFIs remained resilient to COVID-19 cases, except in the case of reduced number of borrowers.

Are small finance banks acting as catalysts for financial inclusion in India? A phenomenological study

PurposeThis paper aims to investigate whether small finance banks (SFBs) in India are working towards financial inclusion through qualitative studies.Design/methodology/approachThis paper uses a phenomenological approach in which semi-structured interviews were conducted with the employees of two SFBs in Mumbai with different specializations. Employee experience was captured to grasp, interpret and code data for the creation of different themes.FindingsThis research shows that the current literature on financial inclusion is inadequate to explain the behavior of the needy in India. Study found multiple themes of financial inclusion, namely, financial literacy, self-esteem, use of technology, prompt repayment, credit identity, cross-referencing and financial stability. Although overall results are positive, to generalize the results, SFBs need to spend some more time in business. The findings of this study can be of global benefit to micro-finance organizations of a similar scale to achieve financial inclusion and business improvement.Research limitations/implicationsThis qualitative study was performed at a single location and with a limited sample size, which underlines the need for repeated exercises at multiple locations with a larger sample size to establish a broader logical generality. It also points out the need for a study of employee themes to enhance the business processes of SFBs.Originality/valueTo the best of the authors’ knowledge, this qualitative study is first attempt to figure out the extent of work done by SFBs in India in promoting financial inclusion. Themes related to financial inclusion can provide further thought process for policymakers for financial inclusion and business improvement. Findings refer not only to Indian organizations but also to small banks around the world to recognize the underpinnings of financial inclusion and what small banks and micro-finance institutions can do to make it meaningful.

Financial Inclusion and Household Welfare: An Entropy-Based Consumption Diversification Approach

State-led financial inclusion programmes have been implemented in many developing countries, but their effectiveness in raising welfare remains widely debated. In this article, we report evidence on this issue, against the backdrop of recent policy initiatives on financial inclusion in India. We employ Theil’s entropy-based index to estimate diversification in consumption expenditure, and use this as a measure of welfare. Using household-level panel data across all regions of the country, we find evidence that greater financial inclusion increases diversity in non-food items. Further, we also notice that there is a shift in consumption basket from food items to non-food items. These findings suggest an improvement in welfare for both rural as well as urban households.

A Descriptive study to assess the knowledge of Pradhanmantri Jandhan Yojana Among young adult people Bhandu Village of Mehsana District

“The Prime minister’s scheme Pradhan Mantri Jandhan Yojana (PMDJY)’ was launched on 28th August 2014 which envisages universal access to banking with a basic banking account with no minimum balance, financial literacy, access to credit insurance and pension. The account holders are benefited with an interest on their deposits, Accidental Insurance Coverage of Rest: 1,00,000/-, Life Insurance Coverage of Rest: 30,000/-, Easy transfer of Money across India, Govt. Schemes Direct Benefit Transfer, Access to Pension and Insurance products and Overdraft facility of up to Rs: 5,000/-. The scheme recorded with opening of15.30 crores accounts as on 29th April 2015, out of which 9.17 crore accounts in rural and 6.13 crores accounts in urban areas. The achievement of this scheme has also taken place in the Guinness Book of World Records for opening most number of bank accounts opened in one week as result of financial inclusion campaign dated August 23 – 29, 2014. The scheme has surpassed original target of opening bank accounts for 7.5 crore excluded households in the country by 26th January 2015 with banks already opening 11.50 crore accounts by 17th January 2015. Objective: To study the need for financial inclusion in India To discuss the salient features and basic pillars of PMJDY. To assess the progress made under the PMJDY. To make some suggestions for smooth functioning of this scheme. Hypothesis: H1: There is no significant association between the Age of the respondents and their First point of contact for getting advices/suggestions on finance H2: There is no significant difference between the Gender of the respondents and their Awareness about the benefits of - Pradhan Mantri Jan – Dhan Yojana (PMJDY)‖ scheme. H3: There is no significant relationship among variables of the benefits of Pradhan Mantri Jan - Dhan Yojana (PMJDY)scheme. Design: Survey-research approach using Descriptive pre-test design with one group. Participation: 50 Adult public were selected using Random sampling technique in Mehsana District. Tool: Self Structured Questionnaire was used to assess the level of knowledge of Adult public regarding PMDJY. Results: Distribution of mean, SD and mean percentage of awareness and knowledge regarding pradhan mantri jandhan yojana score of young adult people shows that the mean score (13.4±2.951) which is 67.00% of total score. Conclusion: The findings of the study revealed that teaching helps in improving knowledge regarding PMDJY among Adult people.

Everyday experiences of digital financial inclusion in India's ‘micro-entrepreneur’ paratransit services

Self-employed labour in transportation is a notoriously precarious form of employment that occurs throughout many developing countries. In order to offset high-cost and insecure vehicle procurement arrangements, paratransit fare structures are formulated on the basis of a set of logics designed to maximise revenues. Although entrepreneurial, when these logics occur in conflict with public fare legislation, they are undertaken illegally, or informally, and are perceived as undesirable by policy makers and transport users. However, the underlying structures that necessitate these practices are seldom examined despite their significant effect on mobilities and the livelihood experiences of male entrepreneurs. This paper engages with critical literatures on the financialisation of poverty reduction to present financialisation as a class-based mechanism that, with the rapid increase of digital payment and ‘alternative’ credit scoring, structures micro-entrepreneurship and precarity in the neoliberal context of India. The paper argues that digitally enhanced financial inclusion techniques may steer low-income workers toward mainstream finance institutions modelled on the global economy. They enable profit to be generated by investors and private microfinance companies. However, new financial technologies do not do little to reduce the risk and expense of microfinance, nor do they increase micro-entrepreneurs' profit margins. Moreover, they threaten the informal practices entrepreneurs use to self-manage their financial precarity.

Role of digital economy and technology adoption for financial inclusion in India

Purpose The study aims to explore the role of digital economy and technology adoption for financial inclusion in the Indian context. Design/methodology/approach A conceptual framework was developed and hypotheses were tested through a survey conducted on 433 educated adults (males and females) residing in different districts of Rajasthan (India). Data was collected through a structured questionnaire and was subjected to confirmatory factor analysis. Structural equation modeling (second-order) was used to validate the measurement model and to test the mediating effect. Findings The measurement model is a confirmatory factor analysis and measures the reliability of the observed variables in relation to the latent constructs and indices shows the overall model fit. Structural model results indicate a complete mediation and a reflective impact (R2 = 0.28) of the extended technology acceptance model on digital economy and financial inclusion relationship. Research limitations/implications The study has taken into account only the perception of educated adults residing more specifically in one geographical area of a country. Thus, it limits the generalization of results in terms of implications to other regions and countries. Practical implications The proposed framework and implications are quite significant for policymakers and service providers to understand the nexus and strategic choices involved in this area. Moreover, understanding of user’s frame dependence would help in the development of digital assistive models that would perhaps mitigate the gap from participation (digital economy) to acceptance (financial inclusion). Originality/value Present study proposed a three-dimensional hypothetical model and conceptualized the digital economy (independent variable) as participation, behavioral intentions measured through the extended technology acceptance model (mediating variable) as adoption and financial inclusion (dependent variable) as acceptance to better understand the nexus. It represents the foremost step and a unique effort in this area. Moreover, the study was empirical and has wider applications both from the perspectives of end-users and service providers.

Behavior science led technology for financial wellness

Financial wellness is regarded as a significant constituent of the overall well-being of individuals. Financial wellbeing is defined as having financial security and freedom of choice, in the present and in the future. This has a direct correlation to overall wellbeing: including productivity experienced at work, quality of relationship, quality of health and hence quality of life. Financial wellness is also challenging as everyone desires to achieve a state of wellness while the pathways to its achievement are not straightforward and can be easily overwhelming to many. In the Indian context, recent reports point to the fact that financial wellness emerges as a top stressor for a majority of people which has also heightened due to the pandemic. A lack of financial wellness thus emerges as a major problem in the country. The prevalence of concerns on financial wellness in fact, is witnessed across the globe. An approach to ameliorating this is through the field of behavioral finance which has uncovered many behavioral biases and barriers which impact how financial decisions are taken. Examples include lack of awareness of financial needs or awareness of the right products, lack of self-control, confusion in making financial choices or being unable to save/invest at the right time. To address this, we present a holistic and hyper-personalized approach that combines technology and behavioral science to influence financial behavior. The solution aims at enhancing financial wellness of individuals using behavioral levers and nudges. This combines two aspects: (1) an engaging user interface at the front-end and (2) a customer insights/behavioral analytics and intervention recommendation system at the back end that suggests appropriate hyper-personalized actionable steps to the user. The solution helps users to visualize their financial needs, set financial goals and receive appropriate personalized nudges to help them in implementing financial plans as they go through various phases of career/life stages. We present our thoughts on how financial wellness can be extended to address financial inclusion in India.

Unveiling Financial Inclusion in India: Status Quo and Determinants of Access to Financial

Unveiling Financial Inclusion in India: Status Quo and Determinants of Access to Financial