Women's Inclusion and its Impact on Digital Finance Usage in Villages in India

This research investigates the relationship between pre-existing levels of women’s economic and social participation and the adoption of digital finance, specifically the Aadhaar-enabled Payment System (AePS) in Bihar. Using the World Bank’s JEEViKA household dataset from 2011, this study identifies regions with varying levels of gender inclusivity and uses principal component analysis to extract key features from 28 gender-related variables, specifically relating to women’s autonomy, a subset of 52 more broadly categorized gender-related variables. The findings present that blocks with greater women's inclusion are positively correlated with greater access to Aadhaar enrollment centers, with an average distance of 3.45 kilometers compared to the less inclusive blocks that have an average distance of 4.90 kilometers. While data limitations prevent the ability to draw causal conclusions, results suggest that pre-existing levels of gender-inclusion may facilitate digital payment adoption. These findings indicate that increased policy efforts targeting women’s issues could accelerate financial inclusion, independent of technology interventions.