Financial inclusion and It's need

What us Financial Inclusion ?

 Financial Inclusion is an attempt to provide financial services including payments, savings, loans etc. to the low-income people and disadvantaged section of the society at an affordable cost. It is also called 'inclusive financing'. The main objective of financial inclusion is to remove the restrictions that keep people out from participating in the financial sector and to provide financial services to meet their specific needs without discrimination of any kind.

Why the need for financial inclusion?

 In the absence of financial inclusion, the unbanked are compelled to join the informal banking sector. Interest rates are also high in these areas and the quantum of loan amount is also very less. Since the informal banking structure is outside the purview of the law, any dispute arising between the lender and the borrower cannot be settled legally.As far as the social benefits of financial inclusion are concerned, let us tell you that the result of financial inclusion not only increases the available savings, but also increases the efficiency of financial intermediation. Not only this, the facility of creating new business opportunities is also available. In this situation, a government-sponsored universal banking system has resulted in greater economic diversification in rural areas as compared to a more competitive banking environment.