Financial Inclusion: An Introduction To Financial Inclusion

Introduction to Financial Inclusion

Financial inclusion is very much necessary for the balanced growth into the country. Basically, financial inclusion is means provision of the banking/financial services and facilities to all the sections of the society by the financial institutions and further these also include the weaker and the vulnerable sections in a particular society. Financial services have grown tremendously in most of the nations of the world over the number of years with the use of advanced technology and the creations of new forms of financial products and various other latest credit facilities, and this development into the financial system helps the nation to achieve progress and develop economically. But somewhere the financial

The term inclusive growth is generally used in economics and means the advancement of equal opportunities to all the economic participants at the time or during the economic growth and sharing of all the economic benefits throughout the society that result from the growth in order to achieve the sustainable growth. Inclusive finance is very important into the nation as it can help remove poverty from the nation and this is possible as inclusive finance provides all the credit facilities like loan for the weaker sections which help them to improve their position into the society. There are certain factors that determine the level of financial inclusion into the country like the socio-economic factors for example, income, literacy and population and the banking factors like deposit and credit penetration. These factors are found to have association with the financial inclusion. Hence the study of such variables or factors can help us in understanding about financial inclusion and the raising of the level of financial inclusion in the nation important for stable growth that is

Generally all the people are rational that is the main aim is to maximize the wealth but sometimes people tend to make irrational decision as they are being influenced by psychological emotions and their behavior becomes unpredictable. The conventional finance fails to explain why people behave in irrational way and why their decisions are irrational, because of which the behavioral finance came into existence. Behavioral finance plays a vital role in inclusive finance. Behavioral finance helps to achieve high level of financial inclusion as it understands the participant’s psychology and gets them involved into the financial/banking