ACKNOWLEDGEMENT

This report is an outstanding prospect to convey my gratefulness to those many

people whose timely help and guidance went a long way in finishing this project
work from commencement to achievement.
I would like to express my sincere thanks to our for
giving me an encouragement, guidance and opportunity for pursuing the project in
this college. Without his valuable ideas and suggestion, I cannot complete my
project report.
This project could not be completed without the able guidance and support of all
the teachers of my department. I also take this opportunity to thank
or guiding me throughout this project.
Last but not the least I would like to thank my classmates, family members and all
those people who helped me for the competition and deeper understanding of the
concept of performance appraisal.
Work on the project has proved to be enlightening experience for me.

Thanking you,

Arith Das
Annexure –IA
SUPERVISOR’S CERTIFICATE

This is to certify that Arith Das a student of B.com Honours Accounting in

Finance of prafulla Chandra college under the University of Calcutta has worked
under my supervision and guidance for project work and prepared this project with
the title FINANCIAL INCLUSION IN INDIA which he is submitting in his
genuine and original work to the best of my knowledge.

Signature
Name: Prof.
Annexure -I
STUDENT’S DECLARATION

I hrerby declare that the project work the title FINANCIAL INCLUSION IN
INDIA Submitted by me for the partial fulfillment of the degree of B.Com
Honours in accounting & finance under the University Of Calcutta is my original
work and has not been submitted earlier to any other University for the fulfillment
of the requirement for any course of study.
I also declare that no chapter of this manuscript in whole or in part has
incorporated in this report from any earlier work done by others or by me.
However, extracts of any literature which has been used for this report has been
duly acknowledged providing details of such literature in the references.
Signature
Name: Arith Das
Address: 61 shekh para lane
Howrah: 711103
Registration No: 046-1111-0439-17
University Roll No: 171046-21-0103
College Roll No: 648
Ph. No: 9123394936
 TABLE OF CONTENTS
CHAPTER PARTICULARS PAGE NO

CHAPTER-1  INTRODUCTION

 Introduction
 Need and Importance of the
study
 Objective of the study
 Research Methodology
 Limitation
 Advantages

CHAPTER-2 CONCEPTUAL FRAME WORK

 Financial Inclusion defines

 Importance of Financial
Inclusion in India.
 Scheme
 Dimension of Financial
Inclusion
 What are the steps taken by
RBI to support Financial
Inclusion
 Strategy for optimum
utilization of Financial
Inclusion
 Review & Literature
 CHAPTER-3 PRESENTATION AND DATA
ANALYSIS
CHAPTER-4 CONCLUSION AND
RECCOMENDATION
CHAPTER-5 BIBLIOGRAPHY

BACKGROUND

With the progress of the Indian economy, especially when the focus is on
the achievement of sustainable development, there must be an attempt to include
maximum number of participation from all the sections of the society. But the lack
of awareness and financial literacy among the rural population of the country is
hindering the growth of the economy as majority of the population does not have
access to formal credit. This is a serious issue for the economic progress of the
country. In order to overcome such barriers, the banking sector emerged with some
technological innovations such as automated teller machines (ATM), credit and
debit cards, internet banking, etc. Though introduction of such banking
technologies brought a change in the urban society, a majority of the rural
population is still unaware of these changes and is excluded from formal banking.
Financial inclusion enables improved and better sustainable economic and social
development of the country. It helps in the empowerment of the underprivileged,
poor and women of the society with the mission of making them self-sufficient and
well informed to take better financial decisions. Financial inclusion takes into
account the participation of vulnerable groups such as weaker sections of the
society and low income groups, based on the extent of their access to financial
services such as savings and payment account, credit insurance, pensions etc. Also
the objective of financial inclusion exercise is easy availability of financial services
which allows maximum investment in business opportunities, education, save for
retirement, insurance against risks, etc. by the rural individuals and firms.

The penetration of financial services in the rural areas of India is still

very low. The factors responsible for this condition can be looked at from both
supply side and demand side and the major reason for low penetration of financial
services is, probably, lack of supply. The reasons for low demand for financial
services could be low income level, lack of financial literacy, other bank accounts
in the family, etc. On the other hand, the supply side factors include no bank
branch in the vicinity, lack of suitable products meeting the needs of the poor
people, complex processes and language barriers.

Since 2005, the Reserve Bank of India (RBI) and the Government of
India (GOI) have been making efforts to increase financial inclusion. Measures
such as SHG-bank linkage program, use of business facilitators and
correspondents, easing of Know Your Customer (KYC) norms, electronic benefit
transfer, separate plan for urban financial inclusion, use of mobile technology,
bank branches and ATMs, opening and encouraging ‘no-frill-accounts’ and
emphasis on financial literacy have played a significant role for increasing the use
of formal sources for availing loan/ credit. Measures initiated by the government
include, opening customer service centers, credit counselling centres, Kisan Credit
Card, Mahatma Gandhi National Rural Employment Guarantee Scheme and
Aadhar Scheme. These renewed efforts are more focused than the earlier measures
which were more general in nature having a much wider scope. Though the
measures were initiated earlier, their impact on the rural population needs to be
analysed and reframed in order to understand the present scenario in the rural
areas.

Brief review of literature:

RBI (2005) proposed financial inclusion based on the business facilitators/
business correspondent model, adapting the Brazilian success story in India. In
2005, efforts were made enabling banking services to reach the rural areas through
credit facilities. While the banking network started expanding in the rural areas,
there were still a majority of the population in rural areas without having access to
banking services.
 
GOI (2008) examined financial inclusion as a delivery mechanism providing
financial services at an affordable cost to the vast sections of the disadvantaged and
low-income groups. The recommendations of the report focused on the following
areas. First, financial inclusion should include access to mainstream financial
products. Second, banking and payment services should be available to the entire
population without discrimination.
Committee also recommended for the constitution of two funds with NABARD –
the Financial Inclusion Promotion and Development Fund, and the Financial
Inclusion Technology Fund for better credit absorption capacity among the poor
and vulnerable sections of the country and also for proper and appropriate
application of technology in order to facilitate the mandated levels of inclusion. In
short, the report provided an understanding of one of the best ways to achieve
inclusive growth through financial inclusion.
 
OBJECTIVE OF THE STUDY
The main theme of the study is to know the factors that influence the Financial and
poverty of the people. Thus the main objective of the study is:
 objective of the study: -

 To reach the concept among the people. In that way people can get all the
services.
 To awaking the people about Financial Inclusion.
 To save excess time and money.
 Government money can be utilized easily.
 Increase Govt. Financial activities.
 To determine the stability of the people who are under poverty line.
 To uses of government scheme of the poor people.

Research Questions:
1. What is financial inclusion?
2. What type of schemes are people use for most for survive who are lived
in
below poverty line?
 METHODOLOGY OF THE STUDY:

Mainly data can be collected using two methods:

1. Primary Data.

2. Secondary Data
.

Sample Size:
A total of fifty respondents were interviewed during the survey. The input
from these 50 respondents which was collected in Howrah city formed the
primary data for the study.

Sample Method:
Sampling may be defined as the selection of some part of an aggregate or
totality on the
Tools for Data Collection:
Interaction with the respondent is done in the form of face-to-face interviews
with the help of questionnaires. The questionnaire consisted of a set of
questions, asked to the respondent for his/her response. The questionnaire
consisted of combination of open ended and close ended questions.

Method of Analysis:
The collected data was analyzed according to the objectives of the study
based upon which suitable suggestions are made. Collected data was
tabulated and with the help of bar graph, pie graphs analysis is done for each
data. The percentage, frequency is worked and evaluation is made to the
tabulated data in the analysis process. Conclusions were done from the
findings.

Limitations of the Study:

 The study was restricted to Howrah city so the findings are applicable
only to the Howrah city.
  Findings of the survey was based on the assumption that the
respondents have given correct information.
 Since the respondents had to fill the questionnaire while they were
busy with their hectic schedule, many people were reluctant to
answer.
 For survey it takes much time.
 The time limitation is one of the factors which influence the study.
 The sample size is very small i.e. only 50 respondents.

Chapter Planning:

Chapter 1 is INTRODUCTION, in which I have discussed the background

of the topic, literature review of the study, objectives f the study,
methodology of the study. There are also some limitations of the study
which has also been discussed in chapter 1.

Chapter 2 is CONCEPTUAL FRAMEWORK, in which I have discussed

the introduction of the topic and terminologies based on objectives and
national and international scenario.

Chapter 3 is PRESENTATION AND DATA ANALYSIS AND

FINDINGS, in which there are some data presentation based on
questionnaire with the help of pie charts, bar graph, etc. In this chapter I
have also discussed the findings.

Chapter 4 is CONCLUSION AND RECOMMENDATION, in which I

have showed the conclusion and the recommendation and suggestions which
will be helpful in future. Chapter 5 is bibliography and annexure including
student declaration and supervisor’s certificate
 Introduction

 Financial inclusion defines:

According to the Planning Commission (2009), Financial inclusion refers to

universal access to a wide range of financial services at a reasonable cost. These
include not only banking products but also other financial services such as
insurance and equity products. The household access to financial services includes
access to contingency planning, credit and wealth creation. Access to contingency
planning would help for future savings such as retirement savings, buffer savings
and insurable contingencies and access to credit includes emergency loans, housing
loans and consumption loans. On the other hand, access to wealth creation includes
savings and investment based on household’s level of financial literacy and risk
perception.

The meaning of financial inclusion is delivery of financial services to the low

income groups especially the excluded sections of the population with the
provision of equal opportunities. The main target is the access of financial services
for better standard of living and income.
Financial inclusion is the process of ensuring access to appropriate financial
products and services needed by all sections of society including vulnerable groups
such as weaker sections and low income groups at an affordable cost in a fair and
transparent manner by mainstream institutional players. This issue started gaining
importance recently in the news media. 
However, as is the case with several issues in India, financial inclusion has
remained a pipe dream with a majority of Indians continuing to lack access to
banking services.
 Financial Inclusion Schemes in India:
The Government of India has been introducing several exclusive schemes for the
purpose of financial inclusion. These schemes intend to provide social security to
the less fortunate sections of the society. After a lot of planning and research by
several financial experts and policymakers, the government launched schemes
keeping financial inclusion in mind. These schemes have been launched over
different years. Let us take a list of the financial inclusion schemes in the country:

 Pradhan Mantri Jan Dhan Yojana (PMJDY)

 Atal Pension Yojana (APY)

 Pradhan Mantri Vaya Vandana Yojana

 Pradhan Mantri Mudra Yojana

 Pradhan Mantri Suraksha Bima Yojana (PMSBY)

 Sukanya Samriddhi Yojana

 Jeevan Suraksha Bandhan Yojana

 Credit Enhancement Guarantee Scheme (CEGS) for Scheduled Castes

(SCs)

 Venture Capital Fund for Scheduled Castes under the Social Sector
Initiatives

 Varishtha Pension Bima Yojana (VPBY)

Advantage of Financial Inclusion:

 Financial inclusion intends to help people secure financial services and products
at economical prices such as deposits, fund transfer services, loans, insurance,
payment services, etc.
 It aims to establish proper financial institutions to cater to the needs of the poor
people. These institutions should have clear-cut regulations and should maintain
high standards that are existent in the financial industry.

 Financial inclusion aims to build and maintain financial sustainability so that the
less fortunate people have a certainty of funds which they struggle to have.

 Financial inclusion also intends to have numerous institutions that offer

affordable financial assistance so that there is sufficient competition so that
clients have a lot of options to choose from. There are traditional banking options
in the market. However, the number of institutions that offer inexpensive
financial products and services is very minimal.

 Financial inclusion intends to increase awareness about the benefits of financial

services among the economically underprivileged sections of the society.

 The process of financial inclusion works towards creating financial products that
are suitable for the less fortunate people of the society.

 Financial inclusion intends to improve financial literacy and financial awareness

in the nation.

 Financial inclusion aims to bring in digital financial solutions for the

economically underprivileged people of the nation.

 It also intends to bring in mobile banking or financial services in order to reach

the poorest people living in extremely remote areas of the country.

 It aims to provide tailor-made and custom-made financial solutions to poor

people as per their individual financial conditions, household needs, preferences,
and income levels.

 There are many governmental agencies and non-governmental organizations that

are dedicated to bringing in financial inclusion. These agencies are focused on
improving the access to receiving government-approved documents. Many poor
people are unable to open bank accounts or apply for a loan as they do not have
any identity proof. There are so many people who live in rural areas or tribal
villages who do not have knowledge about documents such as PAN, Aadhaar,
Driver’s License, or Electoral ID. Hence, they cannot avail many of the services
offered by governmental or private institutions. Due to lack of these documents,
they are unable to avail any form of subsidies offered by the government that
they are actually entitled to.