Effectiveness of Financial Inclusion Programmes: A Case Study of Jammu & Kashmir State

Khaki, A. R. (2018). Effectiveness of financial inclusion programs: a case study of Jammu and Kashmir state. International Journal of Financial Innovation in Banking, 2(1), 29-47.

19 Pages Posted: 13 Dec 2017 Last revised: 13 May 2020

See all articles by Audil Khaki

Audil Khaki

American University of the Middle East; American University of the Middle East

Date Written: January 6, 2018

Abstract

Globally, around 38% of the adult population lack proper access to formal financial products and services. Economies with deeper financial systems tend to be more dynamic, grow faster, and where entrepreneurs (micro-entrepreneurs) avail finance at a cheaper rate and face fewer barriers to the sources of finance. Such unrestrained access also helps in poverty alleviation, reducing income inequality and stable economic growth (Beck et al., 2007; Kim, 2016). Financial Inclusion aims at providing tools and resources to all who are capable; unrestrained access to resources, and more particularly to funds enables such capable citizens to better themselves while simultaneously contributing to the economic progress of the country. Higher Marginal Contributions at the bottom of the pyramid help in leveraging those higher margins to achieve higher overall economic growth. While loans can help in accelerating consumption, improve household conditions, and educating their children; savings can help them absorb unforeseen shocks, and insurance helps them with their coping strategies (Collins et al., 2009; Robinson, 2001; Armendariz and Morduch, 2000, 2005; Littlefield et al., 2003).Thus, financial inclusion must not aim only at broadening financial fabric but also deepening the range of financial services to reach out to those who lack such effective access. Besides an economic imperative of financial access to excluded sections and the benefits thereof, the greater financial inclusion should also focus on financial awareness and customer protection by creating awareness about the products and services, their optimal use, and their rights as a consumer to fulfil the moral imperative of the policy of greater financial inclusion. India, due to its huge diversity, in spite of the heightened efforts to deliver effective access to finance to all, has failed to provide the maintain uniformity in the provision of financial inclusion across regions. While all North-Eastern states seem to be neglected (or least pursued), Jammu and Kashmir remains the least penetrated states in the Northern Region. Against this backdrop, the present study attempts to examine the contours of financial inclusion within the state of Jammu and Kashmir and the progress that has been made so far.

Keywords: Alternative Finance, Financial Inclusion, Alternative Finance, Financial Literacy, Inclusive Growth

Suggested Citation

Khaki, Audil Rashid, Effectiveness of Financial Inclusion Programmes: A Case Study of Jammu & Kashmir State (January 6, 2018). Khaki, A. R. (2018). Effectiveness of financial inclusion programs: a case study of Jammu and Kashmir state. International Journal of Financial Innovation in Banking, 2(1), 29-47., Available at SSRN: https://ssrn.com/abstract=3085432

Audil Rashid Khaki (Contact Author)

American University of the Middle East ( email )

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HOME PAGE: http://www.aum.edu.kw

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