Show simple item record

dc.contributor.authorGhosh, Anandita
dc.contributor.authorKulkarni, Lalitagauri
dc.contributor.authorGokhale Institute of Politics and Economics (GIPE), Pune (India)
dc.date.accessioned2024-09-10T12:19:45Z
dc.date.available2024-09-10T12:19:45Z
dc.date.issued2023-07-01
dc.identifier.urihttp://hdl.handle.net/10973/59773
dc.description.abstractAccording to the BRICS (2021) report on digital financial inclusion, digital technology can be a game-changer in a multidecadal quest to achieving universal financial inclusion. As defined by world bank , digital financial inclusion refers to the deployment of the cost-saving digital means to reach currently financially excluded and underserved populations with a range of formal financial services suited to their needs that are responsibly delivered at a cost affordable to customers and sustainable for providers. Thus, digitalisation ensures financial inclusion, where all major dimensions of financial inclusion that is, access, usage, quality and welfare are encompassed. India’s economy shows every sign of becoming a digital economy with the internet penetration of 61 per cent and over 600 million smartphone users, with the scaling up of the digital payments both in value and volume. Despite the exemplary progress, India still finds itself in a unique conundrum where there has been a persistent gap between access to accounts and the usage of accounts. The Global Findex report 2021 further highlights that about one-third of the account owners had inactive accounts and 540 million adults in India who have an account made no digital payments. India also has the highest share of inactive bank accounts globally at 35 per cent. Thus, the whole policy agenda towards financial inclusion is restricted to mere access. This thesis is driven by this unique conundrum of access and usage and strives to dive-deep into challenges of digital financial inclusion in India. This thesis is a stakeholder wise analysis of digitalisation in the financial inclusion ecosystem. The thesis is an attempt to study the challenges of implementing digitalisation strategy for the low-income segment both from the supply and demand side. By adopting the qualitative and the quantitative research methodology, the thesis provides some intriguing insights on the digital financial inclusion in India from the point of view of various stakeholders of financial inclusion ecosystem. The thesis provides a policy roadmap based on the challenges faced by the stakeholders and their expectations from the regulatory bodies in India. The findings reveal the major demand side and supply side challenges of digital financial inclusion in India. The demand side-analysis is based on a Technology Acceptance model. This is an empirical study which identifies the factors that affect the actual usage of digital financial services among the low-income segment in India. The demand side analysis reveal that the problem of non-usage is rather deep rooted and gets intensified by the factors like gender and age hence, a one-size-fit-all policy will be redundant in enhancing greater usage and adoption. On the other hand, the supply side challenges are based on the perspective of the providers of the financial services as well as the point of view of the emerging stakeholders Fintechs. The supply side study is a descriptive research study based on the survey and interview method of data collection. The findings indicate that despite the exemplary success of digitalisation in India, there are still some underlying challenges from the provider’s end which requires immediate focus and actions from the stakeholders of the financial inclusion ecosystem. The prominent challenges accentuated from the supply side were the high acquisition of the IT/MIS system and the lack of digital and financial literacy among the clients. The qualitative insights from the Fintech sector have unveiled its immense potential as these address the unaddressed pain points of financial inclusion by developing niche products for the underserved segment of the society. Furthermore, the key to a sustainable market strategy for fintech is collaboration and partnership with the incumbent market players. Lastly, the thesis lays the contour of a policy roadmap based on the stakeholder wise challenges. The policy recommendations have emphasised the demand-pull financial inclusion addressing the structural peculiarities which are deeply rooted in the Indian economy. First, it is imperative to have a hybrid model of digital financial inclusion, wherein the human touch and digital innovations must work simultaneously. Second, digital products require hyper-localisation in order to be more age and gender inclusive. Third, it is equally important to fortify the trust amongst the clients with a help of grievance-redressal mechanism and a strong data security and privacy policy in place. Fourth and the most important recommendation, is an open and a collaborative market strategy followed by all the stakeholders to join hands and work in synergy towards greater usage of digital financial services contributing towards the overall welfare of the society. To conclude, the current study has uncovered some interesting facets of digital financial inclusion in India and presents a compendium of insights which can be beneficial for the regulators, financial service providers, users and fintechs.en_US
dc.language.isoen_USen_US
dc.publisherGokhale Institute of Politics and Economics (GIPE), Pune (India)en_US
dc.titleAnalysis of Digitalisation in the Financial Inclusion Ecosystemen_US
dc.typeThesisen_US


Files in this item

Thumbnail

This item appears in the following Collection(s)

Show simple item record