How women are unlocking financial inclusion in rural India

Including women from rural India into the country's financial system. AP

In a country like India, where a large part of the population resides in rural areas, achieving financial inclusion is highly crucial. Societal conditioning in India has marginalised women, leaving them behind in various rights, including financial inclusion. But as per the National Family Health Survey (NFHS-5) – 2019-21 about 78.6 per cent of women in India have a bank or saving account which they operate themselves. With the help of government initiatives, fintech’s wide network and technology platforms, women are now gaining economic independence and developing decision-making power. This empowerment enhances their self-esteem, transforming lives positively. Fintech companies have also played a crucial role by leveraging technology to provide accessible and user-friendly financial solutions. Women, with their strong community networks and determination, are at the forefront of this revolution, driving economic growth and social upliftment in rural India.

Innovative initiatives

Women in rural India are spearheading the movement toward financial inclusion playing a pivotal role in empowering their communities. As per Pradhan Mantri Jan Dhan Yojna. 56 per cent Jan-Dhan account holders are women and there are 67 per cent Jan Dhan accounts are in rural and semi-urban areas. As business correspondents, they act as intermediaries, bridging the gap between formal financial institutions and rural households. Their dedication and understanding of local needs have enabled them to reach the last mile, bringing banking services to remote areas. The government’s efforts in promoting financial literacy and setting up policies supportive of inclusion have further boosted these initiatives.

• Self-Help Groups: Self-Help Groups (SHGs) in rural India address collective challenges by forming informal associations. They have emerged as an effective mechanism for delivering financial services and addressing the diverse problems faced by rural communities. These groups empower rural women, enhancing their financial literacy and decision-making abilities. To address these challenges and promote financial inclusion among rural women, several innovative initiatives have emerged.

• Bank Sakhi: The government is actively spearheading initiatives to promote financial inclusivity by empowering women. Bank Sakhi Yojna has played a crucial role in empowering rural women and promoting their financial inclusion. The Bank Sakhi Yojna trains and deploys women banking correspondents in rural areas. Known as “Bank Sakhis”, these women act as intermediaries between the formal banking system and rural communities and assist villagers in opening bank accounts, conducting transactions, and accessing financial services. As per the Ministry of Rural Development India, more than 50,000 SHG women have been trained and certified as BC Sakhi till 2021 and is proposed to deploy at least one BC Sakhi in the rural areas by the end of 2023-24. Other programs such as the Pradhan Mantri Jan Dhan Yojana, Pradhan Mantri Mudra Yojana, Sukanya Samriddhi Yojana and more have facilitated women’s access to banking services, credit facilities, and entrepreneurship opportunities. These initiatives not only aim to bridge the gender gap in financial inclusion but also recognize the emotional and social empowerment that arises from economic independence.

Role of Fintech and Tailor-Made Products for Rural India

Fintech has emerged as a game-changer in the pursuit of financial inclusion as it leverages technology to bridge the gap between financial institutions and underserved populations. India took the lead with the fintech adoption rate of 87%, which is higher than the world average of 64 per cent as per the latest Global FinTech Adoption Index.

As per the reports, the total number of internet connections in India reached close to 851 million in 2023. Recognizing the potential of women in unlocking financial inclusion, fintechs are actively identifying, hiring, and training women on financial transactions, products, and platforms by equipping them with the necessary skills to educate and assist rural communities in their financial journeys. It leverages women’s influence for last-mile reach, making them self-reliant and helps in breaking sociocultural barriers. By providing user-friendly digital platforms and mobile applications, fintech encompasses innovative payment solutions, digital lending platforms, and customized financial management tools, to ensure accessibility and relevance to rural women. Educating women has a ripple effect, as it empowers future generations and uplifts the entire community. When educated, a woman becomes a catalyst for positive change, influencing her children’s education, breaking the cycle of poverty and fostering overall societal progress.

The collective efforts of fintech, governments and financial institutions are paving the way for a more inclusive and equitable society. Their collaboration ensures products and services that fulfil the needs and preferences of rural women. From developing user-friendly, lightweight platforms to making financial literacy accessible via vernacular language support, fintech is here to ensure that rural women can easily navigate and utilise financial services while unlocking the potential of rural India.

The author is Head – of Strategic Relations, Manipal Technologies Limited. Views expressed in the above piece are personal and solely that of the author. They do not necessarily reflect Firstpost’s views.

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