Objectives: This study intends to find out the status of access to formal financial services (here it is banking services) in Kendrapara and Sunderagarh districts of Odisha in India.
Methods/Statistical Analysis: We applied the purposive random sampling and multistage random sampling methods for selecting the districts and villages respectively. A total of 400 households are chosen proportionately from the four selected villages. Both primary and secondary data are used in the study. Primary data are collected through direct personal interviews of heads of the households using structured interview schedules. Descriptive statistical tools such as averages, percentages and graphs are used for analyzing the data.
Findings: The provision of banking infrastructure in the sample districts is not adequate particularly in the sample panchayats of Sunderagarh district. A poor geographical penetration of bank branches and ATMs are found in this district in comparison to Kendrapara district. 94.8% of respondents in both the districts have access to banking services with 97% in Kendrapara and 89.5% in Sunderagarh district. The primary reasons for opening bank account are receiving govt. benefit transfers and receiving payments for work under National Rural Employment Guarantee Scheme (NREGS). A majority of respondents are found to have opened their account during the financial inclusion drive i.e. in the year 2005 and onwards. Income level and literacy of the respondents are found to be the major determinants of access to bank account. The financial awareness in both the district is very poor which obstructs the households from accessing the associated facilities of a bank account such as debit card, credit card, loan account, cheque facility and overdraft facility. The primary reasons for not having a bank account are lack of regular and sufficient income and lack of financial awareness.
Application/Improvement: The study explores the accessibility and its determinants at grass ischolar_mains level by studying the village households it will be helpful for policy makers for designing appropriate schemes and programmes for improving accessibility and utilization of banking services particularly in the rural and tribal areas.