Published Online:October 2024
Product Name:The IUP Journal of Accounting Research & Audit Practices
Product Type:Article
Product Code:IJARAP071024
Author Name:Mithilesh Pandey, Pooja Sharma and Mashrifa Islam
Availability:YES
Subject/Domain:Finance
Download Format:PDF
Pages:130-150
Considering the fast-paced growth in the Internet and data consumption in India and Bangladesh, it was essential to understand the effect of the technology strategies adopted by both countries on financial inclusion. The study analyzes and compares the determinants that measure the extent of financial inclusion in India and Bangladesh. It also focuses on the computation of a financial inclusion index (FII) that would comprehensively capture the impact of multidimensional variables with specific reference to India and Bangladesh. This study is based on a cross-sectional survey. The approach is similar to the one used by the UN Development Program in the computation of some well-known development indices, such as Human Development Index (HDI). As in the case of these indices, the proposed FII is computed first by calculating a dimension index for each dimension of financial inclusion. Six dimensions of an inclusive financial system have been considered: outreach, usage of the banking system, ease, cost, electronic transactions and risk coverage. The results show that the composite index FII value is 0.549 for India and 0.527 for Bangladesh. This indicates that India is providing slightly better financial inclusion services compared to Bangladesh. The comparative study of various strategies shows that both countries are performing better on one or other factors of six demisnions.
India and Bangladesh, both South Asian countries, have shown a considerable improvement in their financial inclusion schemes in the past few years. Bangladesh has been doing reasonably well since Muhammad Yunus took the Grameen Bank initiative.