Mani Nandhi will be presenting her paper, "Financial Inclusion of the Urban Poor:
Problems and Prospects A study of Cycle Rickshaw Pullers in Delhi" at the
International Association for the Economics of Participation (IAFEP) Conference
hosted by ERMES, University ParisII in Paris, France on 8-10 July 2010.
India’s urban poverty has increased by about 5.8% in the recent decades. A majority
of the urban poor are migrants from rural India, who are both marginalised and discriminated
due to their transient status. In search of livelihoods, the ultra poor rural migrants
are largely employed in the unorganised sector and in unstable occupations (rickshaw
pulling, rag picking, domestic help). These migrants survive between $1 and $2 a day.
However, the financial needs (be it saving, credit or remittance) of these highly
marginalised urban poor remain largely unaddressed due to their uncertain and mobile
habitat, unstable livelihoods, uneven income flows, weak social relations / links
and fragile bonding as well as lack of homogeneous culture among urban poor dwellers.
Formal banking system shuns the urban poor due to their transient nature and similar
above reasons. Since India holds the 50th
place in the ‘Financial Inclusion Index’, there is a clear consensus that the provision
of financial services (savings, loans, insurance and remittance needs) are to be made
available to the bottom of the pyramid to ensure their financial inclusion.
Given that large segments of the migrant poor in urban India require financial services
but remain marginalised, technology has a role to play in achieving financial inclusion
of the poor. However, technology which has revolutionised the Indian banking sector
recently has been largely restricted to its privileged clients from the upper and
middle classes and has financially excluded large sections of the population lacking
even basic banking facilities. Financial inclusion drive calls for a conscious attempt
to reach the vast numbers of excluded poor so as to promote more inclusive growth
One critical input, inter alia, among other efforts towards their financial inclusion lies in building a reliable
and systematic data base to comprehend the financial behaviour of the urban poor for
different occupations. Based on an ongoing empirical study of cycle rickshaw pullers,
who form a huge proportion of disadvantaged urban migrants in Delhi, the present paper
while exploring the financial behaviour of rickshaw pullers throws light on the problems,
constraints and challenges in enabling the marginalised urban poor to be integrated
into mainstream financial services sector in the Indian political and economic context. The
findings are based on an in depth field survey using a combination of methods - interviews
based on structured questionnaires, focus group discussions and case studies of cycle
rickshaw pullers in Delhi.