Financial Inclusion Through India Post

Topics: Bank, Central bank, Poverty Pages: 4 (1209 words) Published: December 21, 2010
Dr. Joji Chandran PhD
India is having the most widely distributed post office system in the world. With 1,55,333 post offices, the India post comes under the Department of Posts which is a part of the Ministry of Communications and Information Technology under the Government of India. The wide distribution network of India post is one important factor that favours india post as a channel for financial inclusion in India. The search of financial inclusion appears to be a tough task. Sustained growth of the nation and its continued prosperity depend critically on universal financial services covering all people. Further, empirical evidence shows that inclusive financial system significantly raises growth, alleviate poverty and expand economic opportunity. In India, the India post when linked to banks in a gradual way initially through saving and later through loan product is considered to be an effective strategy to ensure financial inclusion in this backdrop. This paper examines the scope of India Post in the inclusion (Access) of excluded poor households.

Financial Inclusion
The delivery of financial services to the low income group at affordable cost is termed as financial inclusion. The term "financial inclusion" has gained importance since the early 2000s, and is a result of findings about the unavailability of banking services to the poor (financial exclusion) and its direct correlation to poverty. Financial inclusion is now a common objective for many central banks among the developing nations. The two approaches used for financial inclusion is microfinance and Islamic banking. Financial Inclusion covers a wide array of services by banking sector. According to Mor and Anath (2007) financial inclusion, at a minimum, may be interpreted to mean the ability of every individual to access basic financial services which include savings, loans and insurance in a manner that is reasonably...

References: Ansari Saghir Ahmad (2007), “Mircro Finance in India”, Asian Economic Review, August, Vol.29 (2), pp 327-336.
Chavan Pallavi (2007), “ Access to Bank Credit : Implications for Dalit Rural Households”,
Economic and Political Weekly, April, Vol
Kamath Rajalaxi (2007), “ Financial Inclusion vis-a-vis Social Banking”, Economic and Political Weekly, April, Vol. XLII (15), pp 1334-1335.
Khandelwal Anil,K, (2007), “Microfinance Development Strategy for India”, Economic and Political Weekly, March, Vol. XLII (13) pp 1121-1126.
Misra, Alok, (2006), “Micro Finance in India and Millennium Development Goals: Maximizing Impact on Poverty”, Discussion Paper for Workshop on World Bank, Singapore, Sep. 18.
Mor Nachiket and Bindu Ananth, (2007), “ Inclusive Financial Systems: Some Design Principles and a Case Study”, Economic and Political Weekly, March, Vol. XLII (13) pp 1121-1126.
National Bank for Agriculture and Rural Development (1999), “Task Force Report on Supportive Policy and Regulatory Framework for Micro Finance, Mumbai, India.
NSSO, (2006), “Household Borrowing and Repayment in India During 1-7-02 to 30-6-2003”. All India Debt and Investment Survey, NSS 59th Round, Ministry of Statistics and Programme Implementation, Government of India.
Rangarajan, C (1996), “Rural India, the Role of Credit”, Reserve Bank of India Bulletin, Reserve Bank of India, Mumbai.
Rao Subba K.G.K. (2007), “Financial Inclusion: An Introspection”, Economic and Political Weekly, February, Vol. XLII (5), pp 355-360.
Continue Reading

Please join StudyMode to read the full document

You May Also Find These Documents Helpful

  • Financial Inclusion Through Microfinance-Health Insurance in India Essay
  • Financial Inclusion in India Research Paper
  • A Study of Financial Inclusion in India Essay
  • financial inclusion Essay
  • Financial Inclusion Research Paper
  • Financial Inclusion Essay
  • Financial Inclusion Essay
  • Financial Inclusion Essay

Become a StudyMode Member

Sign Up - It's Free