Title: A universal financial inclusion index covering banking, insurance and pension services in India

Authors: Anand Pandey; R. Murugesan

Addresses: National Institute of Technology, Tiruchirappalli, India ' National Institute of Technology, Tiruchirappalli, India

Abstract: To create a universal social security system for all Indians, especially the poor and the under-privileged, three social security schemes namely, Pradhan Mantri Suraksha Bima Yojana, Pradhan Mantri Jeevan Jyoti Yojana, and Atal Pension Yojana were initiated by the Government of India in 2015. In the paper, a new universal financial inclusion index (FIU) covering banking, insurance, and pension parameters in India are developed. Given that all parameters used in financial inclusion index have separate units, all parameters are normalised using the min-max method of normalisation. The Euclidean distance method is used to assess the distance between any two points in an n-dimensional space. FIU is compared to the financial inclusion index covering banking parameters only. The FIU is a multi-dimensional index that captures values of various banking, insurance, and pension dimensions on the scale of 0 to 1, where 0 indicates complete financial exclusion and 1 indicates complete financial inclusion.

Keywords: universal financial inclusion; PMJDY; PMJJBY; PMSBY; APY; multi-dimensional index.

DOI: 10.1504/IJEBR.2024.139289

International Journal of Economics and Business Research, 2024 Vol.28 No.1, pp.28 - 43

Received: 03 Sep 2021
Accepted: 03 Jan 2022
Published online: 01 Jul 2024 *

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