Digital Financial Inclusion and Rural Economic Empowerment
Author(s): Geetha Balasubramanian, Ramesh Chandra Mohanty, Zainab Hussain Siddiqui
Affiliation: Department of Commerce, Ravenshaw University College, Cuttack, Odisha, India
Page No: 6-9-
Volume issue & Publishing Year: Volume 3, Issue 3, 2026/03/02
Journal: International Journal of Modern Engineering and Management | IJMEM
ISSN NO: 3048-8230
DOI:
Abstract:
Financial inclusion—the equitable access of all segments of society to affordable, appropriate, and reliable financial services—has emerged as a critical development policy priority globally, recognised as an enabler of seven of the seventeen United Nations Sustainable Development Goals (SDGs). India's JAM Trinity—the convergence of Jan Dhan Yojana bank accounts, Aadhaar biometric identity, and Mobile telephony—represents the world's largest financial inclusion initiative, enrolling over 510 million previously unbanked individuals into the formal financial system between 2014 and 2023. This study employs a mixed-methods approach combining household survey data from 2,148 rural households across 18 underdeveloped districts in five Indian states, NFHS-5 district data, and PMJDY beneficiary administrative data. Propensity score-matched difference-in-differences estimation with instrumental variable regression using distance to nearest Common Service Centre as instrument demonstrates: 34.7 percentage point increase in formal savings rate, 28.3 percentage point improvement in formal credit access, 41.2% reduction in welfare payment leakage, and 12.4 percentage point reduction in below-poverty-line household prevalence over five years. Financial literacy significantly mediates 38.2% of JAM adoption's total effect on savings outcomes.
Keywords:
financial inclusion, JAM Trinity, Jan Dhan Yojana, digital banking, rural India, Direct Benefit Transfer, poverty alleviation, propensity score matching, difference-in-differences, financial literacy, mobile banking, Aadhaar
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