Banking services and financial inclusion in India's poorest regions

Financial inclusion involves providing suitable products and services to meet transactional, payment, savings, credit, and insurance needs. While India has progressed in financial inclusion, challenges persist in low-income regions and among marginalised groups. This study assesses the National Strategy for Financial Inclusion (NSFI) 2019-2024 and its potential to address such challenges in Bihar, one of India's poorest states. Field inquiries and interviews with households and bank managers were conducted. The findings reveal that despite NSFI's potential, unawareness, insufficient income, documentation requirements, and lack of trust in the system is persisting and factors such as- region, social groups, gender, age, education, and occupation continue to influence banking participation. So, the study recommends increased awareness, financial literacy, and reduced financial service costs tailored to Bihar's needs and other low-income regions. In addition, strengthening the regulatory framework for informal financial services is suggested.