Assessing Government Efforts to Promote Financial Inclusion for BPL Households in Delhi Slums: Gaps and Policy Improvements

Abstract

Financial inclusion has emerged as a critical policy priority for addressing economic inequality and poverty alleviation in India. This study examines the effectiveness of government initiatives, particularly the Pradhan Mantri Jan Dhan Yojana (PMJDY), and Reserve Bank of India (RBI) regulations in promoting financial inclusion among Below Poverty Line (BPL) households in Delhi's slums. The research employs a mixed-method approach, utilizing primary survey data from 400 BPL households across five major slum clusters in Delhi and secondary data from government sources. The study reveals that while account opening has increased significantly under PMJDY, with over 55 crore accounts opened nationally, substantial gaps remain in usage patterns and awareness levels. The findings indicate that 78% of BPL households possess bank accounts, but only 43% actively use financial services beyond basic savings. The RBI's Financial Inclusion Index improved from 43.4 in 2017 to 64.2 in 2024, yet disparities persist in urban slum areas. Key challenges include limited financial literacy (67% lack basic financial knowledge), inadequate infrastructure, and regulatory barriers. The study recommends targeted policy interventions including enhanced financial literacy programs, simplified KYC procedures, and improved last-mile connectivity to bridge existing gaps and ensure sustainable financial inclusion.