Qualitative Variables Affecting Financial Inclusion in India:Exploring Future Direction for Policy Makers

The 12^th five year plan of India portrays inclusive growth as one of its key objectives. This makes development of rural India a key component for the overall progress. Financial Inclusion Plan (FIP) is a highly effective way to achieve such inclusive growth. As indicated by researchers, the lacunae of policy implementation are the impediments for faster inclusive financial growth in India. Government wants to increase financial inclusion and measure it on the basis of quantitative variables, reasonable attention has not been given to qualitative variables. This study identifies and analyses the qualitative variables which are the possible blockades in the way of financial inclusion. Responses have been collected, with the help of a structured questionnaire, from 206 respondents from the rural areas of Jammu and Kashmir. It is concluded that there is low to moderate level of financial literacy among the prospective beneficiaries and government’s efforts are not sufficient to provide them adequate information. Cumbersome banking procedures, unsuitable products/services, absence of bank branches, illiteracy, social exclusion etc are the other factors that are holding the growth of financial inclusion in India.