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Article
Publication date: 13 August 2021

Tarsem Lal

The purpose of this paper is to check the impact of financial inclusion on economic development of marginalized communities through the mediation of socio-economic empowerment.

Abstract

Purpose

The purpose of this paper is to check the impact of financial inclusion on economic development of marginalized communities through the mediation of socio-economic empowerment.

Design/methodology/approach

In order to fulfil the objectives of the study, primary data were collected from 382 bank customers belonging to marginalized communities breathing in Jammu district of J and K by using purposive sampling technique. The data were collected during the month of April–August 2020. Multivariate statistical techniques such as EFA, CFA and SEM were used for data analysis and scale purification.

Findings

The study’s results reveal that financial inclusion has a direct and significant impact on economic development of marginalized communities through the mediation of social and economic empowerment. The study highlights that despite various initiatives taken by the government towards financial inclusion, there is a denial from the financial institutions to extend the credit to the marginalized communities due to lack of education, illiteracy, lack of awareness, attitude of bankers and policy directions to the banking sector, which confine these communities to feel proud, dignified, confident and self-reliant to face any financial crisis.

Research limitations/implications

First the in-depth analysis of the study is restricted to Jammu district only that restricts the generalization of the results to the whole population of J and K. Second, the data were collected from respondents belonging to marginalized communities only. Third, comparative study of marginalized households who are covered under the financial inclusion drive and those who are still financially excluded has not been done yet. Fourth, the questionnaire approach was the only way to gather primary data and thus, the results might have a common-method bias.

Originality/value

The study makes contribution in the direction of financial inclusion narrative relating to socio-economic empowerment and economic development of marginalized communities. It looks into how for the socio-economic aspects of marginalized communities influence their exclusion from the financial system of the country. The study also provides valuable insights for the policymakers, researchers and academicians both at the countrywide and intercontinental level to devise and put into practice programmes that will widen right to use financial products and services leading to cutback of poverty incidence, income parity, social and economic empowerment, economic development and reduction in caste and gender based discrimination.

Details

International Journal of Social Economics, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0306-8293

Keywords

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Article
Publication date: 31 October 2018

Tarsem Lal

The purpose of this paper is to measure the impact of financial inclusion on rural development through cooperatives.

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Abstract

Purpose

The purpose of this paper is to measure the impact of financial inclusion on rural development through cooperatives.

Design/methodology/approach

The primary data were collected from 540 beneficiaries of Cooperatives banks operating in three northern states of India, i.e., J&K, Himachal Pradesh and Punjab using purposive sampling during January to June 2016. Exploratory factor analysis, confirmatory factor analysis, ANOVA, t-test and structural equation modelling were used for scale purification and data analysis.

Findings

The findings of the study revealed that financial inclusion through cooperatives has direct and significant impact on rural development. Further, the results support the notion that financial inclusion is a strategy of inclusive growth, but inclusive growth itself is a subset of a larger set of inclusive development which means that the benefit must reach the all, particularly the women and the children, minority groups, the extremely poor and those pushed below the poverty line by natural and human-made disasters.

Research limitations/implications

The research has certain inescapable limitations. First, the in-depth analysis of the study is restricted to three northern states of India only because of time and resource constraints. Second, the study is confined to the perception of financial inclusion beneficiaries only, which in future could be carried further on the perception of other stakeholders such as SHGs, banking correspondents, etc. Third, possibility of subjective interpretation in some cases cannot be ruled out.

Originality/value

The study makes contribution towards financial inclusion literature relating to sustainable rural development and fulfils the research gap to some extent by assessing the impact of financial inclusion on rural development through cooperatives.

Details

International Journal of Social Economics, vol. 46 no. 3
Type: Research Article
ISSN: 0306-8293

Keywords

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Article
Publication date: 14 May 2018

Tarsem Lal

The purpose of this paper is to examine the impact of financial inclusion on poverty alleviation through cooperative banks.

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1909

Abstract

Purpose

The purpose of this paper is to examine the impact of financial inclusion on poverty alleviation through cooperative banks.

Design/methodology/approach

In order to fulfil the objectives of the study, primary data were collected from 540 beneficiaries of cooperative banks operating in three northern states of India, i.e., J&K, Himachal Pradesh (HP) and Punjab using purposive sampling during July-December 2015. The technique of factor analysis had been used for summarisation of the total data into minimum factors. For checking the validity and reliability of the data, the second-order CFA was performed. Statistical techniques like one-way ANOVA, t-test and SEM were used for data analysis.

Findings

The study results reveal that financial inclusion through cooperative banks has a direct and significant impact on poverty alleviation. The study highlights that access to basic financial services such as savings, loans, insurance, credit, etc., through financial inclusion has generated a positive impact on the lives of the poor and help them to come out of the clutches of poverty.

Research limitations/implications

The study was conducted amidst few limitations. First, the in-depth analysis of the study is restricted to three northern states only because of limited resources and time availability. Second, the study is limited to the perception of financial inclusion beneficiaries only, which, in future, could be carried further on the perception of other stakeholders such as bank officials, business correspondents, village panchayats, etc.

Originality/value

The study makes contribution towards the financial inclusion literature relating to poverty alleviation and fulfils the research gap to some extent by assessing the impact of financial inclusion on poverty alleviation through cooperative banks. This paper can help the policymakers and other stakeholders of cooperative banks in promoting banking habits among poor rural households both at the national and international level.

Details

International Journal of Social Economics, vol. 45 no. 5
Type: Research Article
ISSN: 0306-8293

Keywords

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