Financial Inclusion in India: A Success Story
Financial Inclusion promotes equitable and inclusive growth and development in a nation by providing finance to vulnerable and disadvantaged segments of the population. It enables the empowerment of the marginalised sections of society, aids them in making better financial decisions, attaining financial self-sufficiency and ensuring universal access to a vast array of financial services. In India, an attempt to expand access to the formal financial sector has been a part of a continuous process since nationalisation of the State Bank of India in 1955 which was undertaken with the main objective of increasing banking penetration in rural areas. Again, in 1969, and followed by another round in 1980, the Central Government nationalised 20 biggest private sector banks. In 1972, priority sector lending was initiated to ensure financial inclusion. However, these efforts did not produce the anticipated outcomes.
This paper attempts to investigate the success of financial inclusion in reaching vulnerable and unbanked sections of Indian society. It is organised into six sections. The next section examines the Pradhan Mantri Jan Dhan Yojana scheme. Section 3 outlines the JAM (Jan Dhan-Aadhar-Mobile) Trinity and its efficacy. In section 4, various government initiatives that facilitated the success of financial inclusion in India are discussed. In the next section, the study provides a success story of how digital infrastructure has helped the government to make major interventions during COVID-19 to mitigate hunger and poverty. In the last section, conclusions are provided.
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