Financial Inclusion Strategies In Developing Countries With Special Reference To India

Day in and day out, the gap between the haves and have-nots is widening, not only at inter- country level but also at the intra � country level. In this process, a large chunk of population does not have access to the formal financial markets, institutions and instruments. It is estimated that as many as eighty seven percent of marginal households in the world lack access to formal finance , and to fulfill their credit needs, they are resorting to the means of informal and unregulated finance, through money lenders, who charge them as much as hundred percent rate of interest. Thus, this stratum of population, in midst of financial exclusion, has been pushed to the vicious circle of poverty and, therefore, remain outside the growth parameters always. However, recently, the governments in about one hundred and forty two countries have become serious to overcome this menace and decided to design strategies to make formal finance available to the un-bankable at cheaper (price) interest. In this way, Financial Inclusion became a buzzword of these strategies. Financial inclusion, as a pre-condition to inclusive development, refers to the process of ensuring the accessibility, availability and usage of formal financial system for all members of an economy. In this paper, an attempt has been made to examine the financial inclusion efforts made at the global level and highlight the progress made on the subject in SAARC countries, and what strategies were designed and implemented in the fast developing economy like India in the past two decades have been discussed in detail.