Financial Inclusion: Role of Banks


  • Love Gogia Assistant Professor, Economics Dept., Bhagini Nivedita college, NCWEB , University of Delhi, India.


Financial Inclusion, Financial Services, Indian Banking, Self Help Groups, Financial products


The issue of financial inclusion is a development policy priority in many countries. Around 50% of the Indian population suffers from chronic poverty and hunger. Only 31% of the Indian population has access to Banking services. The rest 69% are still deprived of bare minimum banking services for which they are totally dependent on informal banking sources like private money lenders. While the need to solve this mammoth problem is great, we are unable to reach large numbers of the poor with products, services and information they need to achieve financial security. It is been proven, levels of human development and financial inclusion in a country move closely with each other. This paper points to the importance of financial inclusion and highlights various policies that have been adopted in India to increase the same. Banking on the poor is a viable option in India as there are huge mass at the bottom of the pyramid. Use of technology plays an important role in leveraging banking services to rural areas as it lower the cost of maintaining the account. Also there should be convergence between regulator, banks, telecom companies and software companies. Financial literacy and credit counseling programmes can create critical mass for financial services which make financial inclusion viable .Financial Inclusion has far reaching consequences, which can help many people come out of abject poverty conditions.


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