Guidelines and Template for

Mid-Semester Project Report

MBA/MSc Project

This document contains:

Section Name Page No.

Guidelines for Mid-Semester Project Report 2
Mid-Semester Project Report 3-16

Work Integrated Learning Programmes Division (WILPD),

BIRLA INSTITUTE OF TECHNOLOGY & SCIENCE, PILANI,
VIDYA VIHAR, PILANI, RAJASTHAN - 333031.

(March 2024)

Page: 1
 Guidelines for MBA/MSc Project

General Guidelines for Mid-Semester Project Report

▪ The entire work of your project and hence the Mid-Semester Project Report must revolve
around the objectives.
▪ The report should be prepared / written in professional style.
▪ The contents of the report should be the result of the original work done by the student. The
report should be written by the student in own words and should not contain copied contents
from other sources. The Final Project Report submitted by the student would be checked for
plagiarism. If the plagiarism level is more than 25%, the student may be awarded RRA, based
on the evaluation of the report.
▪ Text should not be converted into image and pasted in the report as it may lead to inaccurate
results in plagiarism checking.
▪ The soft-copy of your report should meet ALL of the following criteria:-
➢ The file size should be less than or equal to 10 MB.
➢ The number of pages should be minimum 50 and should not be more than 200, with 1.5 line
spacing.
➢ Files should be only in pdf format.
➢ Only those pages requiring a signature should be scanned and embedded in your report. The
content in the rest of the report should be in text format only, otherwise the report will be
rejected (images/illustrations can be scanned and embedded). A simple way to test this is by copy-
pasting the entire content of your report into Notepad (or any other text editor). If the report text
is copied over successfully and is readable, that indicates the report is valid.

Most Important…

▪ Please be sure to follow all the administrative / procedural / operational guidelines (including
timelines) as communicated from time to time from Associate Dean, WILP office, etc.
▪ Please note that the template and contents suggested are indicative only and should not
constrain or limit your creativity or innovation in your project. You can tailor or customize this
template and contents in consultation with your Faculty Guide, to make it more suitable for
your specific project.

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 Challenges to Financial Inclusion:
Diving into Solutions for Success

Course No. : S2-23_MBAZG622T

Course Title: MBA Finance

Mid-Semester Project Report

Student Name: Srinjoy Guha

BITS ID: 2022HB59072

Program: MBA FINANCE

Project Area: FINANCE

Dissertation / Project Work carried out at:

Nagpur

Work Integrated Learning Programmes Division (WILPD),

BIRLA INSTITUTE OF TECHNOLOGY & SCIENCE, PILANI,
VIDYA VIHAR, PILANI, RAJASTHAN - 333031.

(March 2024)

Page: 3
 TABLE OF CONTENTS
Section No. Section Name Page No.
1 Requirement Statement / Problem Statement 5
2 Project Objectives 5
3 Project Scope 5
4 Methodology 6
5 Plan vs Progress 6
6 Detailed description of project completed till Mid-Semester Report 7
7 Resource Requirements and their availability 12
8 Risks and Mitigations 12
9 Issues and Resolutions 12
10 Conclusions and Recommendations 13
Annexure-1 Survey Questionnaire (if any)
Annexure-2 Computer Programs / Code
Annexure-3 Detailed workings (if any)
Annexure-n Any other details to be added A
References 13
Glossary 13
Summary of how the feedback for Project Outline have been addressed 13

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1. Requirement Statement / Problem Statement

Millions of people worldwide don't have access to basic financial services like bank accounts
or loans. This financial exclusion locks them out of opportunities to save, invest, or start
businesses. Without these services, it's challenging for individuals and small businesses to
grow financially. This exclusion deepens poverty, creating a cycle that's hard to break. To build
a fair and thriving global economy, we need to address this problem.

2. Project Objectives

The primary objective of the project is to conduct a comprehensive examination of the barriers
hindering widespread financial inclusion. The project aims to delve into the intricacies of these
challenges, offering a nuanced understanding that goes beyond surface-level analysis.
1. Identify and Analyze Key Challenges: The project will meticulously identify and
analyze the primary challenges impeding financial inclusion on a global scale. This
involves exploring factors such as limited banking infrastructure, financial illiteracy,
regulatory constraints, and systemic inequalities etc.
2. Assess the Impact of Regulatory Frameworks: Regulatory frameworks play a pivotal
role in shaping the financial landscape. The project will assess the impact of existing
regulatory frameworks on financial inclusion, highlighting areas where regulations may
inadvertently create barriers.
3. Explore Technological Innovations: The role of technology in promoting financial
inclusion is paramount. The project will examine the current landscape of technological
innovations, such as mobile banking, digital wallets, and fintech solutions, and assess
their effectiveness in reaching underserved populations.
4. Examine Socio-Economic Factors: Socio-economic factors significantly influence
financial inclusion. The project will delve into the impact of social and economic
disparities on access to financial services, recognizing the intersectionality of gender,
ethnicity, and economic status.
5. Provide Actionable Recommendations: Building on the insights gained from the
analysis, the project will generate practical and actionable recommendations.
6. Contribute to Academic and Practical Knowledge: The project aspires to make a
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 meaningful contribution to both academic research and practical solutions.

In summary, the project's objective is to conduct a thorough exploration of the

challenges to financial inclusion, offering actionable insights that can inform strategic
decision-making. By doing so, it aims to play a pivotal role in advancing the discourse
on financial inclusion and contributing to the development of practical solutions for
success in the global economic landscape.

3. Project Scope

The scope of the project are as follows.

Project Goals: The primary goals of the project are to conduct a comprehensive analysis of
barriers to financial inclusion and provide actionable recommendations for fostering a more
inclusive financial landscape.
Timeline: The project will unfold over a structured timeline aligned with the requirements of
the MBA final semester. The timeline encompasses phases of literature review, data collection,
analysis, and reporting. A detailed schedule will be established, ensuring timely progress and
adherence to project milestones.
Expected Results: The project aims to produce insights that deepen the understanding of
financial inclusion challenges globally, with a focus on regional nuances. Expected results
include a comprehensive analysis of identified challenges, actionable recommendations for
stakeholders, and the generation of knowledge that contributes to both academic research and
practical solutions in the field of financial inclusion.
Deliverables:
1. Data Collection and Analysis: Compilation and analysis of data related to financial
inclusion challenges, with a focus on diverse factors influencing global and regional
scenarios.
2. Recommendation Report: A detailed report outlining actionable recommendations for
policymakers, financial institutions, and businesses to enhance financial inclusion.
3. Presentation and Documentation: An engaging presentation summarizing key
findings and recommendations, accompanied by comprehensive documentation for
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 future reference.
Conditions: The project scope acknowledges the dynamic nature of the financial landscape.
Conditions include the need for flexibility to adapt to emerging trends, evolving regulatory
environments, and advancements in technology.
Management: Project management will adhere to best practices.

In conclusion, the project scope is designed to provide a robust framework for addressing
financial inclusion challenges, encompassing research, analysis, and actionable
recommendations. By considering diverse factors and maintaining flexibility, the project aims
to contribute meaningfully to the ongoing discourse on financial inclusion and foster positive
change in global economic ecosystems.

4. Methodology

This project employs a comprehensive methodology to address its objectives. Initially, a

thorough literature review will be conducted to establish a foundational understanding of global
financial inclusion challenges. Simultaneously, an assessment of existing regulatory
frameworks will be conducted to understand their impact on financial inclusion. Technological
innovations will be explored through a review of existing solutions like mobile banking and
fintech, evaluating their effectiveness in reaching underserved populations.
The project will contribute to academic knowledge through publications and presentations,
ensuring its practical application by providing tangible solutions for enhancing financial
inclusion on a global scale. This holistic approach integrates diverse research methods,
ensuring the project's relevance in academic and practical spheres.

5. Plan vs Progress

Plan Progress Remarks

Identifying the causes of 100% Complete
financial exclusion
Data Collection and 50% Data collection and analysis
Analysis to be completed have started. Some of the
before submission of mid data have been collected

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 semester report.
Identifying the challenges
associated with
achievement of financial
inclusion.
Providing suggestion and
recommendations to
overcome the challenges
Recommendation Report to
be prepared during final
submission.
Presentation and
Documentation during final
submission.
and analyzed that have
already been included in
this report. However, I am
working on collecting some
more data and statistics and
it’ll be included in the final
report.
50% Challenges have been
identified. But detailed
explanation will be provided
along with final report.
- Will be submitted in final
report.
- Recommendations will be
made in the final report
only.
- Presentation will be made
along with final report.

6. Detailed description of project completed till Mid-Semester Report

Literature review has been completed so far by collecting various data pertinent to the
project. The details of various reports followed have been mentioned in the reference.
In this section, we would point out various latest data related to Financial Inclusion (FI)
and what are the various issues and hindrances to FI.

Before delving into the solutions for financial inclusion, we must see first why financial
exclusion happens. The severity of the financial exclusion would then be analyzed with
the help of various data. The following points have been found out to the major reasons
of financial exclusion.
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Causes of financial exclusion:

1. Lack of surplus income: Financial exclusion often begins with a fundamental

issue: the lack of surplus income among individuals or households. When people
do not have money left over after covering essential expenses like food, housing,
utilities, and transportation, they face significant barriers to accessing and
utilizing financial services effectively. This lack of surplus income can act as a
root cause of financial exclusion for several reasons.
i. Firstly, without surplus income, individuals are unable to save money for
emergencies, investments, or future expenses. Savings serve as a crucial
buffer against unexpected financial shocks, such as medical
emergencies, car repairs, or job loss. However, those without surplus
income find it challenging to build savings, leaving them vulnerable to
falling deeper into financial hardship when faced with unforeseen
circumstances.
ii. Moreover, financial institutions often require customers to maintain a
minimum balance in their accounts or meet certain income thresholds to
access basic banking services. Individuals without surplus income may
struggle to meet these requirements, limiting their ability to open and
maintain bank accounts. As a result, they may resort to using alternative
financial services that are often more costly and less secure, perpetuating
their financial exclusion.
iii. Additionally, the lack of surplus income restricts individuals' access to
credit. Many financial products, such as loans and credit cards, require
applicants to demonstrate a certain level of income to qualify. Without
surplus income, individuals may be deemed ineligible for credit,
preventing them from financing important purchases, investments, or
education expenses. This lack of access to credit further exacerbates their
financial exclusion and limits their ability to improve their financial situation
over time.
iv. Furthermore, individuals without surplus income may struggle to afford
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 fees associated with financial products and services, such as account
maintenance fees, overdraft charges, or transaction fees. As a result, they
may avoid using formal financial services altogether, opting instead for
cash transactions or informal financial arrangements. This avoidance not
only limits their ability to participate in the formal financial system but also
exposes them to greater financial risks and vulnerabilities.
v. Overall, the lack of surplus income acts as a significant barrier to financial
inclusion by hindering individuals' ability to save, access credit, afford
fees, and participate in the formal financial system effectively. Addressing
this barrier requires comprehensive strategies aimed at increasing income
levels, reducing expenses, and improving access to affordable financial
services for underserved populations.

2. Lack of trust in the system: Financial exclusion often stems from a lack of trust
in the financial system among individuals or communities. When people perceive
financial institutions as untrustworthy or inaccessible, they are less likely to
engage with formal financial services, leading to exclusion from essential
financial products and opportunities. This lack of trust can manifest in various
ways and significantly contribute to financial exclusion for several reasons.
i. Firstly, historical and systemic factors, such as discriminatory lending
practices, predatory financial products, and institutional biases, have
eroded trust in the financial system among marginalized communities.
Past experiences of exploitation or mistreatment by financial institutions
have left lasting scars, leading individuals to view the formal financial
system with skepticism and distrust.
ii. Moreover, the complexity and opacity of financial products and services
can further exacerbate distrust among consumers. Many financial
products, such as loans, mortgages, and investment options, involve
complex terms, fees, and risks that may not be adequately explained or
understood by individuals, particularly those with limited financial literacy.
As a result, consumers may feel overwhelmed or misled by the financial
industry, reinforcing their distrust and reluctance to engage with formal
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 financial services.
iii. Additionally, instances of fraud, misconduct, or high-profile financial
scandals can erode trust in the entire financial system, affecting
individuals' perceptions of its reliability, integrity, and accountability. Even
if they have access to formal financial services, individuals may hesitate
to entrust their money or personal information to institutions they perceive
as untrustworthy or unethical.
iv. Furthermore, cultural or social factors can influence trust in the financial
system. In some communities, informal financial networks or traditional
savings practices may be more trusted and familiar than formal banking
institutions. As a result, individuals may prefer to rely on informal financial
arrangements, even if they are less secure or efficient, rather than
engaging with formal financial services that they perceive as foreign or
alienating.
v. Overall, the lack of trust in the financial system acts as a significant barrier
to financial inclusion by deterring individuals from accessing formal
financial services and products. Addressing this barrier requires efforts to
rebuild trust through transparent and accountable financial practices,
culturally sensitive approaches, and initiatives that prioritize consumer
protection and empowerment.
3. Not suitable to customer’s requirements: Financial exclusion can occur when
available financial products and services do not meet the diverse needs and
preferences of customers, particularly those from underserved or marginalized
communities. When individuals cannot find suitable financial solutions that align
with their unique circumstances, they are effectively excluded from accessing
essential financial tools and opportunities. This mismatch between customer
requirements and available offerings can contribute to financial exclusion for
several reasons.
i. Firstly, traditional financial institutions often design products and services
based on standard assumptions about customer needs, preferences, and
risk profiles. However, these one-size-fits-all approaches may overlook
the diverse financial needs and circumstances of individuals, particularly
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 those with limited income, credit history, or access to formal financial
education. As a result, many consumers may find existing financial
products unsuitable or irrelevant to their specific situations, leading to
disengagement or avoidance of formal financial services.
ii. Moreover, individuals from underserved or marginalized communities may
face unique financial challenges or constraints that require tailored
solutions not readily available in mainstream financial markets. For
example, migrant workers, refugees, or individuals with irregular income
streams may require flexible banking options, remittance services, or
microfinance solutions that accommodate their specific needs and
circumstances. However, the lack of customized financial products and
services catering to these populations can hinder their financial inclusion
and perpetuate their reliance on informal or alternative financial channels.
iii. Additionally, the pricing and terms of available financial products and
services may be prohibitive or inaccessible to certain customer segments,
particularly those with limited income or creditworthiness. High fees,
minimum balance requirements, and stringent eligibility criteria can pose
significant barriers to accessing essential financial tools and services,
leaving many individuals underserved or excluded from formal financial
markets.
iv. Furthermore, cultural, linguistic, or technological barriers can also
contribute to the mismatch between customer requirements and available
offerings. Individuals from diverse backgrounds may face challenges
navigating complex financial systems, understanding product terms and
conditions, or accessing digital banking platforms due to language barriers
or limited digital literacy. As a result, they may struggle to find suitable
financial solutions that meet their needs and preferences, further
exacerbating their financial exclusion.
v. Overall, the lack of suitable financial products and services that address
the diverse needs and circumstances of customers can act as a significant
barrier to financial inclusion. Addressing this barrier requires efforts to
promote innovation, diversity, and inclusivity in the design and delivery of
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 financial products and services, ensuring that they are accessible,
affordable, and responsive to the needs of all individuals and
communities.
4. High transaction costs: High transaction costs represent a significant barrier to
financial inclusion, creating obstacles for individuals, particularly those from
underserved or marginalized communities, to access and utilize formal financial
products and services effectively. These costs encompass fees, charges, and
expenses associated with various financial transactions, such as opening
accounts, making payments, transferring funds, or accessing credit. When
transaction costs are prohibitively high, individuals may be deterred from
engaging with formal financial institutions, leading to their exclusion from
essential financial tools and opportunities.
i. One of the primary ways in which high transaction costs contribute to
financial exclusion is by limiting individuals' ability to afford or access basic
banking services. Many financial institutions impose fees and charges for
opening and maintaining accounts, conducting transactions, or accessing
certain features or services. For individuals with limited income or
resources, these costs can represent a significant burden, making formal
banking services inaccessible or unaffordable. As a result, many
individuals may opt for cash-based transactions or informal financial
arrangements, which often lack the security, convenience, and benefits of
formal banking services, perpetuating their exclusion from the formal
financial system.
ii. Moreover, high transaction costs can disproportionately affect low-income
or financially vulnerable populations, exacerbating existing inequalities
and disparities. Individuals living paycheck to paycheck or struggling to
make ends meet may find it challenging to afford fees associated with
banking services, such as account maintenance fees, overdraft charges,
or ATM withdrawal fees. These costs can eat into already limited budgets,
leaving individuals with less disposable income to cover essential
expenses or save for the future. Consequently, many individuals may opt
to forgo formal banking services altogether, further marginalizing
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 themselves from mainstream financial opportunities and resources.
iii. Additionally, high transaction costs can hinder individuals' ability to access
credit or borrow money, further perpetuating their financial exclusion.
Financial institutions often charge interest rates, origination fees, or other
costs associated with loans and credit products, making them less
accessible or affordable for individuals with limited resources or
creditworthiness. Without access to affordable credit, individuals may
struggle to finance important purchases, investments, or expenses,
limiting their ability to build assets, improve their financial situation, or
weather financial emergencies. This lack of access to credit can reinforce
cycles of poverty and exclusion, trapping individuals in a cycle of financial
instability and vulnerability.
iv. Furthermore, high transaction costs can discourage individuals from
engaging in formal financial transactions or investing in financial products
and services, such as savings accounts, investment funds, or insurance
policies. When the costs of participating in the formal financial system
outweigh the perceived benefits or returns, individuals may choose to
allocate their resources elsewhere or avoid financial activities altogether.
As a result, they miss out on opportunities to build wealth, mitigate risks,
or achieve their financial goals, further widening disparities and barriers to
financial inclusion.
v. In summary, high transaction costs represent a significant barrier to
financial inclusion, limiting individuals' ability to afford or access essential
financial products and services. Addressing this barrier requires efforts to
reduce fees, charges, and expenses associated with formal financial
transactions, improve affordability and accessibility of banking services,
and promote inclusive approaches to financial service provision that
prioritize the needs and circumstances of all individuals and communities.
By lowering transaction costs and making financial services more
affordable and accessible, policymakers, financial institutions, and
stakeholders can help promote greater financial inclusion and empower
individuals to participate more fully in the formal financial system.
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5. Lack of requisite documents: Financial exclusion often occurs when
individuals lack the necessary documentation to access formal financial products
and services, such as identification cards, proof of address, income verification,
or credit history. Without these requisite documents, individuals face significant
barriers to opening bank accounts, applying for loans or credit cards, or engaging
with other essential financial tools and opportunities. This lack of documentation
can contribute to financial exclusion for several reasons.
i. Firstly, financial institutions typically require customers to provide certain
documents to verify their identity, address, and financial stability as part
of the account opening or loan application process. However, individuals
who lack these requisite documents, such as immigrants, refugees, or
individuals experiencing homelessness, may be unable to meet these
requirements, preventing them from accessing formal financial services.
ii. Moreover, the process of obtaining necessary documentation can be
challenging, time-consuming, and costly for many individuals, particularly
those from underserved or marginalized communities. Obtaining
government-issued identification cards, proof of address, or income
verification documents may require navigating bureaucratic processes,
paying fees, or overcoming logistical barriers, such as transportation or
language barriers. As a result, many individuals may face obstacles in
obtaining the requisite documents needed to access formal financial
services, perpetuating their financial exclusion.
iii. Additionally, individuals with limited or no credit history may struggle to
demonstrate their financial stability or creditworthiness to financial
institutions, further hindering their ability to access essential financial
products and services. Without a positive credit history or references from
previous financial institutions, individuals may be deemed risky or
ineligible for loans, credit cards, or other financial opportunities,
exacerbating their exclusion from formal financial markets.
iv. Furthermore, legal or regulatory barriers may also contribute to the lack of
requisite documents among certain populations. For example,
undocumented immigrants may face restrictions or challenges in
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 obtaining government-issued identification or other necessary documents
due to their immigration status, limiting their ability to access formal
financial services and participate in the formal economy.
v. Overall, the lack of requisite documents required to access formal
financial products and services acts as a significant barrier to financial
inclusion for many individuals and communities. Addressing this barrier
requires efforts to simplify documentation requirements, reduce barriers
to obtaining necessary documents, and develop alternative approaches
for verifying identity and financial stability, particularly for underserved or
marginalized populations.
6. Remoteness of service provider: Financial exclusion can occur when
individuals or communities lack physical or geographical access to formal
financial service providers, such as banks, credit unions, or microfinance
institutions. When financial institutions are inaccessible or distant from where
people live or work, individuals face significant barriers to accessing essential
financial products and services, contributing to their exclusion from formal
financial markets. The remoteness of service providers can act as a barrier to
financial inclusion for several reasons.
i. Firstly, individuals living in rural or remote areas may have limited access
to brick-and-mortar bank branches or financial service providers due to
geographic isolation, sparse population density, or inadequate
infrastructure. As a result, they may need to travel long distances to
access banking services, open accounts, or conduct financial
transactions, posing significant time, cost, and inconvenience barriers.
ii. Moreover, the high costs associated with operating physical bank
branches in remote or underserved areas may lead financial institutions
to prioritize urban or affluent markets over rural or marginalized
communities. This geographic bias can exacerbate disparities in access
to financial services and perpetuate financial exclusion for individuals
living in remote or underserved areas.
iii. Additionally, individuals with mobility impairments or transportation
challenges may face difficulties accessing physical bank branches or
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 financial service providers, further limiting their ability to engage with
formal financial services. Without accessible and inclusive banking
infrastructure, these individuals may be effectively excluded from
accessing essential financial products and opportunities available to
others.
iv. Furthermore, the lack of physical presence or outreach efforts by financial
service providers in underserved or marginalized communities can
contribute to distrust, alienation, and disengagement from formal financial
institutions. When individuals do not see themselves represented or
catered to by mainstream financial institutions, they may turn to alternative
or informal financial channels that are more accessible or familiar,
perpetuating their financial exclusion.
v. Overall, the remoteness of financial service providers acts as a significant
barrier to financial inclusion by limiting individuals' access to essential
financial products and services. Addressing this barrier requires efforts to
expand and diversify the delivery channels and outreach strategies of
financial institutions, improve physical and digital infrastructure in
underserved areas, and promote inclusive approaches to financial service
provision that prioritize the needs of all individuals and communities.
7. Lack of awareness about the product: Financial exclusion often occurs when
individuals lack awareness or understanding of available financial products and
services, including their features, benefits, and risks. When people are unaware
of the financial opportunities and resources available to them, they may miss out
on essential tools for managing their finances, building assets, or achieving their
financial goals. This lack of awareness can contribute to financial exclusion for
several reasons.
i. Firstly, limited financial literacy and education can hinder individuals'
ability to make informed decisions about their finances and navigate the
complexities of the financial system. Without a basic understanding of
concepts like budgeting, saving, investing, and credit management,
individuals may struggle to assess their financial needs, evaluate
available options, or avoid costly financial mistakes. As a result, they may
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 be less likely to engage with formal financial services and products,
perpetuating their financial exclusion.
ii. Moreover, the marketing and advertising practices of financial institutions
may not effectively reach or resonate with underserved or marginalized
communities, leading to gaps in awareness and understanding of
available financial products and services. Messages and materials
promoting financial products may not be culturally relevant, linguistically
accessible, or tailored to the unique needs and preferences of diverse
populations, limiting their effectiveness in reaching and engaging target
audiences.
iii. Additionally, individuals may face information overload or confusion when
presented with a wide array of financial products and services, each with
its own terms, features, and fees. Without clear and transparent
communication from financial institutions, individuals may struggle to
discern which products are suitable for their needs and circumstances,
leading to inertia or avoidance of financial decision-making altogether.
iv. Furthermore, stigma or social barriers may discourage individuals from
seeking out information or assistance about financial products and
services, particularly if they perceive financial matters as taboo or
intimidating. Cultural norms, family dynamics, or social pressures may
influence individuals' attitudes and behaviors towards money
management, affecting their willingness to seek out financial education or
advice from trusted sources.
v. Overall, the lack of awareness about available financial products and
services acts as a significant barrier to financial inclusion by limiting
individuals' ability to make informed decisions about their finances and
access essential financial tools and resources. Addressing this barrier
requires efforts to improve financial literacy and education, enhance
outreach and communication strategies, and promote inclusive
approaches to financial empowerment that empower all individuals to
make informed financial decisions and achieve their financial goals.
8. Poor quality of services rendered: Financial exclusion can occur when
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individuals receive substandard or inadequate services from financial institutions,
leading to dissatisfaction, disengagement, or avoidance of formal financial
products and opportunities. When people experience poor quality services, such
as delays, errors, or disrespectful treatment, they may lose trust in the financial
system and seek alternative or informal financial solutions. This poor quality of
services rendered can contribute to financial exclusion for several reasons.
i. Firstly, individuals may experience frustration or dissatisfaction when
dealing with cumbersome or inefficient processes for accessing financial
products and services. Long wait times, complicated paperwork, and
bureaucratic hurdles can create barriers to opening accounts, applying for
loans, or resolving issues with banking transactions, leading individuals to
perceive formal financial institutions as unresponsive or unhelpful.
ii. Moreover, errors or mistakes made by financial institutions, such as
incorrect account balances, unauthorized charges, or delayed
transactions, can undermine individuals' confidence in the reliability and
integrity of the financial system. When people encounter problems with
their accounts or transactions, they expect prompt and effective resolution
from their financial providers. However, repeated instances of poor
service quality or customer service failures can erode trust and loyalty,
driving individuals to seek alternatives or disengage from formal financial
services altogether.
iii. Additionally, disrespectful or discriminatory treatment by financial
institutions can alienate and marginalize individuals, particularly those
from underserved or marginalized communities. Instances of prejudice,
bias, or harassment based on factors such as race, ethnicity, gender, or
socioeconomic status can further exacerbate feelings of exclusion and
distrust, leading individuals to avoid or boycott financial institutions that
fail to respect their dignity and rights.
iv. Furthermore, inadequate support or guidance provided to customers,
such as limited access to financial advice, counseling, or assistance, can
leave individuals feeling unsupported or ill-equipped to navigate their
financial challenges. Without personalized guidance or resources to help
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 them make informed decisions about their finances, individuals may
struggle to achieve their financial goals or overcome barriers to financial
inclusion.
v. Overall, the poor quality of services rendered by financial institutions acts
as a significant barrier to financial inclusion by undermining individuals'
trust, confidence, and satisfaction with the formal financial system.
Addressing this barrier requires efforts to improve service delivery,
enhance customer support and communication, and promote a culture of
accountability, transparency, and respect within financial institutions.

Status of Financial Inclusion in India compared to its region and the world

I have collected certain data based on Global Findex 2021 published by World Bank.
The Bank publishes data country wise as well as region wise. The data of the region
where our country belongs have been placed alongside the overall world data.
Comparison on these data have been done to see where we stand in terms of FI. The
data also highlights the change over the years of the report i.e. 2017, 2021 etc. Let’s
have a look at these data.

Account (% age 15+) India South Asia World

All adults, 2021 77.5 67.9 76.2
All adults, 2017 79.9 69.5 68.5
All adults, 2014 53.1 46.5 61.9
All adults, 2011 35.2 32.3 50.6
Financial institution account
(% age 15+)
All adults, 2021 77.3 65.8 74.0
Opened first account to receive 54.3 43.4 ..*
a wage or government
payment
Mobile money account (% age
15+)

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 All adults, 2021 10.4 11.6 10.2
All adults, 2017 2.0 4.2 4.3
Account, by individual
characteristics (% age
15+)
Women 77.6 65.8 74.0
Adults in the poorest 40% of 78.3 67.5 71.9
households
Adults out of the labor force 72.7 61.3 65.4
Youth (ages 15–24) 67.5 58.0 65.5
Made or received digital
payments in the past year
(% age 15+)
All adults, 2021 34.9 33.7 64.1
All adults, 2017 28.7 27.8 52.1
Women 28.0 26.5 60.6
Adults in the poorest 40% of 26.0 26.1 57.4
households
Received a digital payment 19.4 18.7 42.6
Made a digital payment 24.7 24.9 58.8
Received a government 11.4 10.0 20.5
payment into an account
Received a private sector wage 5.9 5.4 20.9
into an account
Sent or received a domestic 7.1 9.2 ..*
remittance payment using
an account
Made a digital utility payment 9.5 10.7 27.0
Made first digital utility payment ..* 7.7 ..*
during COVID-19
Made a digital merchant 11.9 9.7 ..*
payment
Made first digital merchant 7.7 6.3 ..*
payment during COVID-19

Page: 21
 Storing or saving money in
the past year (% age 15+)
Used account to store money 34.5 29.5 47.9
for cash management
Saved any money 23.5 22.6 48.8
Saved using an account 14.1 12.3 30.8
Saved using a savings club or a 8.3 8.1 ..*
person outside the family
Borrowing in the past year (%
age 15+)
Borrowed any money 44.8 43.8 52.9
Borrowed formally, including 12.8 12.1 29.2
using a credit card
Borrowed from a savings club 2.9 2.9 ..*
Borrowed from family or friends 31.0 31.0 27.4
Not very difficult to access
emergency money in 30
days (% age 15+)
All adults, 2021 31.3 32.5 59.2
Women 23.8 25.0 55.3
Adults in the poorest 40% of 14.2 17.0 45.5
households

Challenges to financial inclusion:

After studying various data and reports I have found out the undermentioned to be the
challenges to financial inclusion.
1. Lack of Access to Financial Services
• Millions of people worldwide lack access to basic financial services such as
banking, savings accounts, and insurance.
• High costs associated with maintaining bank accounts, transaction fees, and
minimum balance requirements can exclude low-income individuals from

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 accessing financial services.
2. Poor Financial Education and Literacy
• Limited understanding of financial concepts and products among populations
exacerbates financial exclusion.
• Many individuals lack the necessary knowledge to make informed financial
decisions, leading to vulnerability to predatory practices and financial
exploitation.
• Poor financial literacy often results in mismanagement of funds, leading to cycles
of debt and financial instability.
3. Absence of Financial Instability Policies
• Inadequate government policies and regulations may fail to address the needs
of underserved populations, perpetuating financial exclusion.
• Regulatory barriers may prevent innovative financial products and services
tailored to the needs of marginalized communities from emerging.
• Without comprehensive policies promoting financial inclusion, marginalized
groups remain underserved and financially marginalized.
4. Unavailability of Traditional Credit Data
• Traditional credit scoring models often rely on data such as credit history and
income, which may be unavailable for many individuals, especially those in
developing countries or informal economies.
• Lack of traditional credit data excludes individuals from accessing formal credit,
making it difficult for them to invest in education, housing, or entrepreneurship.
• Without alternative credit assessment mechanisms, individuals without
traditional credit data face barriers to accessing financial services and
opportunities for economic advancement.
5. Economic Barriers:
• Economic barriers encompass a range of factors, including high transaction
costs, lack of access to affordable credit, and limited income-generating
opportunities.
• For low-income individuals, the cost of accessing and maintaining financial
services can be prohibitive, leading to exclusion from the formal financial system.
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 • Limited access to credit and capital constrains economic mobility and hinders
entrepreneurship and investment opportunities, perpetuating cycles of poverty.
6. Geographical Barriers:
• Geographical barriers refer to the challenges faced by individuals residing in
remote or rural areas, where financial infrastructure such as banks or ATMs may
be scarce or non-existent.
• Limited physical access to financial institutions makes it difficult for individuals in
these areas to open accounts, deposit savings, or access credit, exacerbating
financial exclusion.
• Additionally, inadequate transportation infrastructure further compounds the
challenges of accessing financial services in remote regions.
7. Technological Barriers:
• Technological barriers arise from limited access to digital devices, internet
connectivity, and digital literacy.
• In an increasingly digitalized financial landscape, individuals without access to
technology or the skills to navigate digital platforms are at a disadvantage.
• Without access to online banking, mobile payments, or digital financial tools,
marginalized populations are excluded from the convenience and efficiency of
digital financial services.
8. Income Inequality:
• Income inequality exacerbates financial exclusion by widening the gap between
the affluent and the economically disadvantaged.
• Low-income individuals often lack the resources to access financial services,
invest in education or healthcare, or build savings for emergencies.
• The concentration of wealth and resources among the affluent further
perpetuates disparities in access to credit, investment opportunities, and
financial security.
9. Gender Inequality:
• Gender inequality manifests in various forms, including disparities in access to
education, employment opportunities, and property rights, which directly impact
financial inclusion.

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 • Women face additional barriers such as cultural norms, discriminatory practices,
and limited access to financial resources, constraining their ability to participate
fully in the formal economy.
• According to a study conducted by the All India Credit and Investment Survey
(AIDIS) in 2019, even though 80.7% of women in the rural area and 81% in the
urban area have access to banking services, about 55% do not actively use
them. When it comes to the adoption of digital financial products such as credit
cards, debit cards, and payment wallets, the disparity between men and women
is evident. According to the survey, 20% of rural women reported having a debit
or credit card compared to 64% of men. There is a 17% gender gap in card
ownership even in urban areas. In addition, mobile phone ownership by women
is 20% less than that of men, and mobile internet usage is 50% lower. Only 14%
of women in India have smartphones. This significantly inhibits access to and
use of mobile-based digital financial services by women. On the credit front, the
loan rejection rate for women-owned businesses is 2.5 times higher than for men.
Lack of collateral, difficult access to guarantors, weak property rights and various
cultural barriers collectively prevent them from obtaining loans for productive
purposes. In this way, gender inequality causes a major barrier to financial
inclusion.

As the challenges have been identified, the challenges and data will be studied in
further detail and accordingly recommendations will be made based on the
challenges noted above. Effort will be made to support recommendations with more
data set.

10. Resource Requirements and their availability

The project requires a blend of human, technological, and informational resources. Human
resource would be provided by myself. Access to relevant databases, scholarly articles, and
financial reports is crucial for literature review and analysis. Additionally, the project will
leverage data available on the internet for analysis. A well-defined project timeline ensures
efficient resource utilization and timely completion.

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11. Risks and Mitigations
1. Data Collection Challenges: Risk: Difficulty in obtaining comprehensive and accurate
data due to limitations in data availability. Mitigation: Employ a diverse data collection
approach, combining surveys, etc.
2. Regulatory Changes: Risk: Unforeseen changes in regulatory frameworks may impact
the relevance of findings. Mitigation: Regularly monitor regulatory updates.
3. Technological Constraints: Risk: Technical issues or limitations may hinder the
exploration of technological innovations. Mitigation: Ensure access to robust
technological resources, anticipate potential issues.
4. Resource Constraints: Risk: Unavailability of specific resources may impact project
execution. Mitigation: Develop a detailed resource plan and prioritize resource
allocation based on critical project phases.
5. Publication Risks: Risk: Challenges in publishing findings may hinder academic
contributions. Mitigation: Explore multiple publication avenues to increase the likelihood
of disseminating research findings.
6. Timeline Pressures: Risk: Unforeseen delays may jeopardize the timely completion of
the project. Mitigation: Develop a realistic project timeline, regularly review progress,
and have contingency plans for potential setbacks.

This comprehensive risks and mitigation plan anticipates challenges across various project
dimensions and outlines proactive measures to ensure the project's success and impact.
Regular monitoring and flexibility in the approach will be key to navigating potential obstacles
effectively.

12. Issues and Resolutions

Mainly two issues have been faced during conduct of this study. How they were handled have
been noted.

1. Huge variety of data: Internet has so much data available as this is a highly discussed
and debated topic around the world. Hence which data is important and which is not,

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 are very important. Finding out the relevant data for project was the challenge. However
necessary filtering has been made by going and studying the data thoroughly to
understand the relevance.
2. Time constraints: Various work related matters are causing delay in working more on
the data and study. However a timeline has been made and it is being followed and
reviewed thoroughly to ensure timely submission.

13. Conclusions and Recommendations

Final conclusions and recommendations would be provided during submission of final report.

Annexures

Excerpt from Global Findex database 2021 pointing the data pertinent to India for a detailed
picture on how Financial Inclusion still remains a challenge in India.

References

1. National Strategy for Financial Inclusion, 2019-24, Reserve Bank of India

2. Global Findex Database 2021, World Bank
3. 2022: The Little Data Book on Financial Inclusion, World Bank Group

Glossary

Will be updated in the final report.

Summary of how the feedback for Project Outline have been addressed

Feedback provided by Project Guide How the feedback has been addressed
on the Project Outline by me

Overall Comments: The abstract is well- Based on feedback given by the project
written, encompassing all necessary guide, I have collected the required data
aspects. However, the research from various reports. The sources may be

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methodology appears challenging to referred as high quality references as they
implement in practice. I recommend belong to reputed financial institutions like
providing a clearer outline of the research World Bank, Reserve Bank of India etc. I
framework. Additionally, please ensure have also made a mention of the reports
the inclusion of in-text citations for in the references section.
references, and it is essential to
Further data collection from other
incorporate a comprehensive list of
financial institutions are in progress and
references used in the document.
entire analysis along with conclusion and
recommendations will be made in final
Improvement Areas: 1.Detail the
report. Nonetheless, data will be collected
research methodology for both
from high quality sources only and proper
secondary data and primary data
citation will be made along with the
collection and analysis. 2. Utilize high-
comprehensive list of these references.
quality references, such as recent
research papers from reputable journals, In the Mid-term report, I have
government reports, and global research incorporated these modifications in this
reports accessible on their official report that was not part of the project
websites. 3. Ensure proper citation of outline; the entire modifications as
references within the text and provide a suggested will be made in the final report.
comprehensive list of these references at
Thank you for the guidance.
the end, following the APA style. 4.
Integrate these modifications into the
Mid-term report. Feel free to reach me in
case of any doubts.

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 BIRLA INSTITUTE OF TECHNOLOGY & SCIENCE, PILANI
Work Integrated Learning Programmes Division (WILPD)

Particulars of Student
Student Id 2022HB59072
Student Name Srinjoy Guha
Student E-Mail Address 2022hb59072@wilp.bits-pilani.ac.in
Employing Organization and Reserve Bank of India, Nagpur
Location
Programme Name MBA Finance
Semester final semester
Project Title Challenges to financial inclusion: diving into solutions for success

Particulars of the Supervisor and Additional Examiner

Supervisor Additional Examiner
Name Shri Shashank Hardeniya Niraj Kumar
Qualification Bachelor of Engineering Bachelor of Technology
Designation Assistant General Manager Manager
Employing Organization and Reserve Bank of India, Nagpur NMDC Limited, Jagdalpur, CG
Location
Phone No (with STD code) 9424380597 9406269581
Email Address shardeniya@rbi.org.in nirajkumar@nmdc.co.in

Remarks of the Supervisor on Mid-Semester Project Report

Signature of Student Signature of Supervisor Signature of Additional Examiner

Name: Name: Name:

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Please write to WILP Project at project@wilp.bits-pilani.ac.in for any queries /
clarifications.

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