Unlocking Financial Inclusion Through Kisan Credit Card: The Interplay Of Risk, Benefits And Institutional Trust

Abstract

The present research is a study that was carried out in 2024 into the contribution that the Kisan Credit Card (KCC) scheme had towards financial inclusion of rural families in Central India. The first one was to estimate the effect perceived risks, benefits, and institutional trust have in the adoption of the KCC and the aftermath effect on digital financial inclusion. The study used a structural equation modelling (PLS-SEM) with a systematic research design to analyse how a structured questionnaire data captured the response of 512 rural households. These results show that perceived benefits and perceived risks have a serious influence on the KCC adoption. Higher levels of financial literacy and government contribution had a positive effect on the level of perceived benefits and higher levels of the financial infrastructure and bank trust had a negative effect on the level of perceived risks. The effect of adopting KCC was concluded to bring about a significant direct effect on digital financial inclusion, and the findings emphasise the importance of the government initiative, which includes Jan Dhan Yojana and UPI, in the financial transformation. The study indicates that decreasing the perceived risks and increasing the perceived benefits are the necessary strategies of the enhanced KCC adoption on the way to better financial inclusion of rural locations.