A Study on the exogenous variables which influence the Regular Saving behavior of the poor in India

The agenda of financial inclusion has been one of the top priorities of several developing economies. India is pursuing the goal of financial inclusion through several parallel efforts, both governmental and otherwise. Towards this effort, the Microfinance Industry in India is playing a key role of taking credit to the door step of people. However, in all of this rapid growth and expansion of the Microfinance industry in India, financial inclusion has been narrowed down to micro-credit inclusion. The other main pillar of financial inclusion, that is, Savings, has been largely neglected. There are several reasons stated for this, from regulatory to safety issues. However, a key unstated underlying assumption among several bodies has been that the poor cannot save. This is a myth that is being broken with proven facts in several parts of the developing world. Several region specific studies are required to substantiate with evidence, the importance of saving behavior in the lives of the poor. As a subset to this, it is very important for the government, policy makers and the financial industry to understand the factors that would influence the saving behavior of the poor. In the light of this situation, the study through carefully collected primary data, attempts to understand some of the independent variables which affect the saving behavior of the poor in South India.