Digital Financial Services: Unveiling the Collective Potential in Rural Landscape of India

Sharma, Himanshu
Díaz Andrade, Antonio
Vaidya, Ranjan
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Doctor of Philosophy
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Auckland University of Technology

Access to financial services not only has the potential to ignite economic prospects but also supports human development. The progress of information and communication technologies (ICTs) has significantly improved the accessibility, security, speed, and affordability of financial services, all thanks to the advent of ICTs. Prior research has predominantly centred on the implementation, deployment, and adoption of digital financial services (DFS), but the aim of this study diverges from this established focus. This qualitative and interpretive research examines how individuals in rural areas leverage DFS to achieve life goals.

The research fieldwork of this study focuses on rural areas in the Uttar Pradesh (UP) state of India. Data collection using ethnographic techniques is conducted in seven villages within two districts of UP state: Gautam Buddha Nagar (GBN) and Bulandshahr (BS). The sample comprises thirty-six interviews, serving as the data set for the thematic analysis guided by an inductive-abductive reasoning approach. This blended method is embraced to identify core themes and extract novel insights into the role of DFS’s contribution to people’s lives.

The thematic analysis revealed three core themes. The first two themes of this study contribute to existing knowledge about the instrumental role of DFS in expanding an individual's economic opportunities and financial literacy. The third theme challenges the conventional DFS perspective. It emphasises the DFS's potential to cultivate a pro-social environment where individuals share DFS resources, such as knowledge, skills, and applications.

The mapping of core themes with extant theories unveils a conceptual DFS use continuum, symbolising two interrelated poles: the personal use of DFS and the collective use of DFS. Theoretical insights indicate that DFS can facilitate the development of a collaborative support system through the involvement of active DFS users in the closely-knit fabric of social networks.

This study has practical implications, particularly for banking institutions to understand the social capital dynamics, identify active DFS users within communities across their operational zones, and offer them specialised training programmes to strengthen the DFS ecosystem.

Information and communication technology (ICT) , digital financial services (DFS) , capabilities , social capital , collective usage , developing countries , rural communities
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