Impact of Financial Inclusion on Standard of Living: Evidence from Rural Households in Assam.

This article investigates the impact of financial inclusion on the standard of living among rural households in the Barak Valley region of Assam, India, using primary data from 405 households. Financial inclusion is measured through a Composite Financial Inclusion Index (CFII) based on access, usage, and quality of financial services as defined by the Reserve Bank of India, while the standard of living is assessed via a Living Standard Index (LSI) incorporating Water, Sanitation and Hygiene (WaSH), education, health, and wealth indicators. The study finds a statistically significant positive relationship between financial inclusion and the standard of living, with permanent employment, household expenditure, and membership in self-help groups also contributing positively. Variables such as age, education, and dependency ratio showed no significant direct effect on living standards in this context. The findings suggest that policy efforts to expand financial access, promote digital literacy, and support inclusive financial innovations are essential for improving rural livelihoods in Assam.