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

Rajalaxmi KamathSubscribe to Rajalaxmi Kamath

Accessing Institutional Finance: A Demand Side Story for Rural India

Under the Reserve Bank of India's "financial inclusion" campaign, the provision of institutional finance has been progressing at differential rates across the country. However, when we pair administrative banking data on availability of bank branches in a state with the All India Debt and Investment Survey (2002-03) capturing both institutional and non-institutional borrowing by households, we find that states with the most access to institutional finance, or supply, are not necessarily the ones with the most demand for finance. Looking at household level data within each state we identify determinants of institutional borrowing, and some of the strongest predictors for accessing institutional finance. A number of empirical regularities emerge in terms of the importance of having assets like land for borrowing, which undermines the basic philosophy of financial inclusion.

Financial Inclusion vis-a-vis Social Banking

The banking sector in India is making a concerted effort to increase the degree of financial inclusion in the system. This article explains financial inclusion, shows how it differs from social banking and suggests how, today, it can do more for the poor than social banking did in the past.

Fringe Benefits Tax

The fringe benefit tax in India is levied on the same basis as Australia and New Zealand, two countries that have the most evolved FBT systems. A comparison of India's approach to defining and taxing fringe benefits with that in these two countries is undertaken here.
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