Perceptions on Banking Service in Rural India: An Empirical Study

Abstract

The purpose of this paper is to assess the level of banking penetration in a sample village and to find the relationship between bank accounts and related factors, such as, occupation, income and asset-holding status. The findings indicate that 75.2 per cent of the respondents have bank accounts and 26.7 per cent of the respondents avail credit facilities. Two-thirds of the respondents have inclination to avail credit facilities for dairy and for other business activities. Using chi square analysis, significant relationships were established between bank account and relevant factors, such as, occupation, income and asset-holding pattern. While using logistic regression, we find that having a bank account has a significant correlation with income. The findings provide practical implications for bankers in terms of providing banking services in rural areas. The existing gap in credit facilities offers manifold opportunities to bankers for providing various credit facilities. Since the findings indicate that majority of the respondents show an inclination for availing credit for dairy activities, suggestions are offered for tapping potential customers. The article offers not only valuable suggestions to bankers and academicians but also to the government and policy bodies for designing and monitoring financial inclusion targets.