Main Article Content
Abstract
The importance of Financial Inclusion to national economies is evident from the support extended by individual governments and international bodies around the world.(Frost & Sullivan Report, 2009) Banking services are being viewed increasingly as a public good that needs to be made available to the entire population without discrimination. The degree of publican in financial inclusion may be different from a typical public good like ‘defense’. But being as important as access to water or basic education, it does qualify to be termed as ‘quasi-public good’ (Mehtrotra et.al2009). This recognition has made financial inclusion a policy objective for policy makers and others engaged in developmental activities. It is estimated that globally about 2.9 billion people are excluded from access to financial services,(World Bank, United Nations 2006). According to the National Sample Survey Organization, (2003, 59thround) 45.9 million farmer households in the country (51.4%), out of a total of 89.3 million house holds do not access credit, either from institutional or non-institutional sources. Further, despite the vast network of bank branches, only 27% of total farm households are indebted to formal sources (of which one-third also borrow from informal sources). Farm household’s not accessing credit from formal sources as a proportion to total farm households is especially high at 95.91%, 81.26% and 77.59% in the North Eastern, Eastern and Central Regions respectively.