Financial Inclusion in India Breaking the Myths and Challenges: The Case of Uttarakhand

Abstract

Uttarakhand is a state in North India famous for its hill stations and tourism. As it is a hilly state, providing financial services is going to be a bigger challenge. The state lacks the spread of industries due to its geographic diversities; moreover, the prevailing industries have become concentrated into some specific plain areas. The hill part of the state is experiencing, migration of youth as its biggest problem. Uttarakhand's achievement with regard to Financial Inclusion may be a more tough task as hundreds of villages still do not have access to roads and other basic amenities and remain cut off during the winter. Agriculture is a primary source of work, although contribution to income is low due to poor rainfall in non-monsoon seasons over the last three years. This is unfortunate and easily remediable because the region still receives rainfall in the monsoon months. Loans for water-harvest tanks can help push up agricultural productivity significantly. A lot of the landscape is barren due to deforestation, thus loans for plantation can potentially help increase incomes and improve the local ecosystem as well. Also, the region grows apples and potatoes as cash crops, however, there are a few insurance companies that provide cover for these crops. Households generally seemed to be interested in this kind of financial service but due to geographical constraints list of service getters remains limited to the ones living close to the market/road. An awareness regarding various financial instruments and government schemes are still unknown to many faculty members and students. The study critically analyzes the issues and challenges involved in financial inclusion for inclusive growth and would also attempt to highlight the factors that can aid in achieving financial inclusion for inclusive growth in Kumaun and Garhwal regions of Uttarakhand.

Keywords: Financial, Inclusion, Banks, Uttarakhand