ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Articles by Jyoti Prasad MukhopadhyaySubscribe to Jyoti Prasad Mukhopadhyay

Determinants of Digital Technology Adoption and Financial Inclusion in India

The status of digital technology adoption after the launch of Pradhan Mantri Jan Dhan Yojana in 2014 is examined. Using microdata from two rounds (2013 and 2015) of a pan-India survey, the uptake of digital technology platforms among Indian adults for making financial transactions is examined and its determinants are investigated. The results suggest that being male and having a higher education, salaried job, smartphone, and access to mobile internet are positively associated with higher uptake of digital technology platforms. These results are fairly robust across empirical specifications.

Financial Inclusion in India

Existing literature on financial inclusion works with indices that use supply-side information on financial services and fail to capture demand-side information. These indices thus have a serious limitation: they might overestimate the extent of financial inclusion due to multiple bank accounts held by the same individual. Using micro-level data available from a pan-India survey, we compute a financial inclusion index for 22 states based on demand-side information. We find evidence of disagreement between the ranking of the states done on the basis of a supply-side information-based index and our demand-side information-based index. Also, exploiting the microstructure of the data, we attempt to identify some determinants of borrowing from formal sources. We find that being male, having a bank account and higher educational qualification are positively correlated with the likelihood of formal borrowing.
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