Socio-economic Development through Financial Inclusion: An Indian Perspective

Financial inclusion has been the buzzword in development economics particularly in developing countries like India which is striving hard helping the people escape from the poverty successfully. The new financial inclusion matrix includes aspects like penetration, usage and quality and the parameters related to these aspects determine the inclusiveness of financial and economic policy for overall development of the society and country. The Indian government is facilitating the provisioning of financial products and services through banks in order to make these services and products accessible to all without failure. This study aims to analyse the impact of financial inclusion parameters on country`s economic and social development. The independent variables taken for analysis are number of Scheduled Commercial Bank branches, Credit disbursement by Regional Rural Banks and credit provisioning through Self Help Group in India. The impact of these variables on GDP per capita and HDI score as dependent variables has been analysed using regression analysis. The outcomes of the analysis shows that there was an impact of independent variables on GDP per capita of the country and also on social development index in terms of Human Development Index score of India from the year 2003 to 2022, but the impact was not significant at 95 % confidence level. The significant reason of insignificant improvement on dependent variables owing to independent variables was covid pandemic. Besides, lack of customised schemes for region specific implementation could be among reasons.