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2023 | Book

Financial Inclusion in Circular Economy

A Bumpy Road Towards Sustainable Development


About this book

This book presents an assessment of endeavors towards Financial Inclusion and its role in Sustainable development. An attractive feature is that it deals with almost all the contemporary issues essential for reaching UN Sustainable Development Goals. This book would be an exclusive and authentic source to the students of undergraduates, postgraduates and professional courses in Commerce and Management. This manuscript is divided into nine chapters.

The book looks at various salient topics, including financial inclusion measurement, the impact of various financial inclusion indicators on development outcomes and macroeconomic volatility using aggregate data, and the effects of financial inclusion on poverty and development outcomes using microdata. Using the recently adopted Sustainable Development Goals as an overall framing of the issues, it exhibits how poor and disadvantaged women and men can be bankable if the adequate facilitation for maximizing opportunities and addressing constraints. This book attempts to cover different dimensions of Financial Inclusion towards attaining Sustainability and Circular Economy through financing instruments and investments. This book highlights different goals of UN SDG as an Initiative towards Inclusive Growth and Circular Economy, which is also influenced by Micro Finance Institutions and NBFCs.

This book will be an indispensable source for the Students of PG and UG programs, Researchers and practitioners from areas of Commerce, Economics and Management and the faculty members and professionals like bankers and financial consultants. We hope this book will meet the requirement of all the categories of readers.

Table of Contents

Chapter 1. Sustainable Development Goals – An Initiative towards Inclusive Growth and Circular Economy
If a nation’s most vulnerable sector eventually becomes financially independent, it will be able to grow economically and socially. Governments worldwide have recently launched several initiatives to create inclusive growth, and steps have been taken to ensure that all feel the benefits of policies. Only a nation with a robust financial system can have sustained prosperity, economic development, and economic progress. All resources, funds, and capital must be allocated appropriately for the Indian economy to achieve its inclusive and sustainable development aims.
Vinay Kandpal, Deep Chandra, Narendra N. Dalei, Jatinder Handoo
Chapter 2. Key Drivers and Challenges for Financial Inclusion
The purpose of this research is to identify aspects crucial to financial inclusion in developing economies such as India, as well as to demonstrate the impact of financial inclusion on socio-economic growth. Financially literate people are more likely to make sound financial decisions. “Access to Information and Investment Purpose”, “Investment Performance”, “Financial Socialization”, “Usage of Financial Products and Services”, “Expectation from SHGs and NGOs”, “Perceived Benefits from Investment”, “Future Expected Performance of Financial Instrument”, “Financial Education”, “Issues and Challenges in Financial Technology”, “Social Inclusion”, “Financial Literacy and Awareness”, “Short Term Planning”.
This study would be beneficial globally because the UN SDGs emphasise inclusive growth that leaves no one behind. It addresses topics such as gender, women’s empowerment, poverty, and improvements in infrastructure amenities such as banking, hospitals, and schools, to name a few. A country can develop economically and socially if its vulnerable sections become financially self-sufficient. Sustainable development is possible when resources are equitably available and accessible to all people, regardless of gender disparities. Despite various socioeconomic changes worldwide, women continue to be among the most vulnerable people, unable to access resources on par with males.
Vinay Kandpal, Deep Chandra, Narendra N. Dalei, Jatinder Handoo
Chapter 3. Socio-economic Impact of Financial Inclusion
Financial inclusion is the distribution of affordable financial services to disadvantaged and low-income parts of society, compared to financial exclusion, where these services are unavailable or unaffordable. The focus of financial inclusion in India is to promote sustainable development in rural and hilly areas. The literature and the studies advocate financial inclusion as a policy taken up by the government to achieve sustainable or inclusive economic growth and reduce poverty levels. It also focuses on financial inclusion’s role in women’s financial literacy and empowerment. It can further be added that the effectiveness of financial inclusion programs can be enhanced by exclusively targeting women rather than targeting both men and women belonging to weaker or deprived families. Governments have prioritized various financial inclusion initiatives to provide access to more vulnerable families and bring them to mainstream financial services, including insurance. It is necessary to create an environment where people can receive high-quality services from financial and non-financial institutions if SHGs are to develop inclusively and sustainably and empower women. Financial literacy can endow women to build a financial personality of their own with their household savings and help them increase their accessibility to financial instruments and financial services for a better return on investment. This could give them financial freedom and power.
Vinay Kandpal, Deep Chandra, Narendra N. Dalei, Jatinder Handoo
Chapter 4. Financial Literacy for Promoting Sustainability
A country’s economy needs a robust financial system to grow and progress sustainably. Many formidable challenges have been faced in the area of financial inclusion, such as bridging the gap between the various sections of society that are financially excluded within the sphere of the formal financial system, providing financial literacy, and strengthening credit delivery mechanisms to improve socio-economic development. Considering that the new entrants to the financial system are likely to be more vulnerable, customer protection and grievance redressal have become important pillars for furthering sustainable financial inclusion.
This is further accentuated by the fact that there has been a steep increase in access to digital financial services, which calls for a robust customer protection framework. Some of the measures undertaken include increased market monitoring, the creation of strong enforcement machinery to redress customer grievances and improved coordination between the financial sector supervisors.
Vinay Kandpal, Deep Chandra, Narendra N. Dalei, Jatinder Handoo
Chapter 5. Financial Capability and Financial Well-Being for a Sustainable Society
Financial capability of an individual is the ability to use and manage financial products for current and future financial needs with adequate financial knowledge. Financial access can, directly and indirectly, benefit small firms and poor households, make them more capable of taking advantage of investment opportunities and insures them against risks. Consumers of financial products and services require a secure, transparent marketplace and the financial means to navigate that market successfully. A growing agreement is emerging that the ultimate measure of financial literacy success is individual financial well-being should be improved through efforts.
Vinay Kandpal, Deep Chandra, Narendra N. Dalei, Jatinder Handoo
Chapter 6. Expanding Financial Inclusion Through Fintech and E-governance
Currently, a number of people have access to banking products thanks to numerous digital initiatives. Governments around the world have launched a number of programs to promote inclusive growth and financial inclusion. Opening a Basic bank account with the Jan Dhan Scheme is available in India, with simplified KYC procedures and no minimum balance requirement. It is simpler to complete financial transactions on mobile devices thanks to mobile connectivity. Despite having these accounts, many first-time customers are unable to use the financial ecosystem. Instead of improving the delivery of traditional services, digitalization now aims to offer businesses in the financial sector fundamentally new business opportunities and models. Innovative client engagement strategies, new financial instruments, financial businesses, and financial technologies are all provided by Fintech companies and forward-thinking banking and financial services institutions. To reach adults, workplace financial education is crucial.
Vinay Kandpal, Deep Chandra, Narendra N. Dalei, Jatinder Handoo
Chapter 7. Financial Inclusion for Empowering Women – Way Ahead
A country can develop economically and socially if its weakest section can turn out to be financially autonomous. Sustainable development can be achieved when resources are equally available and accessible for all, irrespective of gender differences. Despite several socio-economic developments worldwide, women still fall among some of the most vulnerable communities, unable to access resources at par with men. Thus, women’s empowerment emerges as a theme central to sustainable development. This paper studies the gender gap in various fields and how empowering women would ensure inclusive development in different sectors. Sustainable growth, economic development, and the progress of an economy can only be achieved if a country has a robust financial system. All the resources from top to bottom must be appropriately channelized to attain inclusive growth in an economic system.
Vinay Kandpal, Deep Chandra, Narendra N. Dalei, Jatinder Handoo
Chapter 8. MFIs and NBFCs Contributions Towards Financial Inclusion and Circular Economy
The role of microfinance institutions and non-banking financial companies is to evolve as a means of financial inclusion and a circular economy that is accessible and affordable for the excluded groups/regions. It can help to loosen the grip of informal sources of finance and bring the excluded sections permanently into the ambit of formal finance. Financial literacy can empower women to develop a financial identity even with their household savings and help them get access to formal credit for gainful occupation, giving them economic freedom and power. In the global world, the micro-credit movement has to be viewed from a long-term perspective under the Self Help Groups (SHGs) framework. There is a need for an innovative and diversified microfinance sector which will contribute to women’s empowerment. Government policymakers should focus on the importance of small savings and loan provisions for consumption and group formation. The Government policy can support the Self-help groups (SHGs) in rural areas through public investment in infrastructural development, including education and health care. They should enact policies to regulate the quality of SHGs and could help in the financial management of SHGs for responsible and sustainable growth.
Vinay Kandpal, Deep Chandra, Narendra N. Dalei, Jatinder Handoo
Chapter 9. Financial Sector Governance Policies and Regulations
We analyze the Indian government’s and regulators’ contributions to the principles and practices of financial inclusion in enhancing the poor’s access to financial services in the past and present and suggest future corrective actions. We discover that psychological and business factors are the main obstacles. For the development of an innovative digital market and financial system, there is a need for a strong and dynamic ongoing research-based business model, as well as a sense of sustainability and inclusivity. It will support our interventions in regular financial services, including a payment system with new differential players, at an appropriate scale and size. However, this won’t be effective until strategic financial sector development and growth are integrated with financial inclusion.
Vinay Kandpal, Deep Chandra, Narendra N. Dalei, Jatinder Handoo
Financial Inclusion in Circular Economy
Vinay Kandpal
Deep Chandra
Narendra N. Dalei
Jatinder Handoo
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