IDEAS home Printed from https://ideas.repec.org/a/sae/prodev/v26y2026i1p27-46.html

Caste and Credit: Discrimination in India’s Credit Sector

Author

Listed:
  • Navjot Sangwan

    (Navjot Sangwan is the corresponding author (n.sangwan@gre.ac.uk) and is affiliated with the School of Accounting, Finance and Economics, University of Greenwich, London, UK.)

  • Bibhas Saha

    (Bibhas Saha is affiliated with Durham University Business School, Durham University, Durham, UK.)

Abstract

This article examines how caste shapes access to credit in India’s formal and informal lending markets. Using nationally representative data from the India Human Development Survey (2011–2012), we analyse loan application rates and loan amounts and compare outcomes between General Castes (GC) and three lower-caste groups: Other Backward Castes (OBC), Scheduled Castes (SC) and Scheduled Tribes (ST). We find that GC households are more likely to apply for and receive larger loans from formal banks, while lower-caste households rely more heavily on informal moneylenders. A substantial share of these credit gaps—particularly in bank lending—remains unexplained by observable characteristics, pointing to potential caste-based discrimination. In contrast, moneylenders do not appear to penalize lower-caste borrowers to the same extent and, in some cases, lend more than expected to OBC households. These findings suggest that entrenched caste hierarchies continue to influence credit access in India, with formal institutions reinforcing rather than correcting social inequalities.

Suggested Citation

  • Navjot Sangwan & Bibhas Saha, 2026. "Caste and Credit: Discrimination in India’s Credit Sector," Progress in Development Studies, , vol. 26(1), pages 27-46, January.
    • Handle: RePEc:sae:prodev:v:26:y:2026:i:1:p:27-46
    DOI: 10.1177/14649934251411694
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/14649934251411694
    Download Restriction: no
    File URL: https://libkey.io/10.1177/14649934251411694?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:prodev:v:26:y:2026:i:1:p:27-46. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.