ABSTRACT
Financial inclusion serves as a vital conduit in the government's resource distribution mechanism, ensuring meaningful integration of the urban poor into the formal economic system. To enhance financial inclusion coverage among this segment, a Lean Six Sigma methodology is applied, widely recognized for its efficacy in process improvement and quality management. Financial inclusion is explored through the lens of the urban poor, with a focus on identifying elements deemed Critical to Quality (CTQ). This approach leads to the formulation of a measurable outcome, represented as the Y metric – coverage under financial inclusion schemes.
A quantitative assessment is conducted to evaluate the influence of various X metrics on the Y metric, thereby identifying the key drivers that significantly impact credit accessibility for the urban poor. The process uncovers inefficiencies and non-value-adding elements in the current system, which are then addressed through targeted improvements. The proposed framework streamlines the process of Samuha (group) loans, promotes greater digitalization, and embeds principles of transparency and accountability.
Additionally, the analysis highlights potential challenges to implementation and outlines critical policy measures needed to overcome them. These include the establishment of a robust grievance redressal mechanism, the development of an efficient IT infrastructure, and the creation of a Sovereign Credit History Register. Together, these recommendations aim to support a more inclusive, transparent, and efficient financial ecosystem.
