Read the following passage and answer the questions based on the passage :
While financial inclusion is often praised as a driver of equitable growth, its implementation in rural India presents a paradox. On paper, schemes such as the Pradhan Mantri Jan Dhan Yojana (PMJDY), Aadhaar-enabled payment systems, and mobile banking have revolutionized access. Yet, in practice, access does not necessarily translate into utility. A significant number of rural account holders remain dormant users, often constrained by digital illiteracy, infrastructural limitations, and deeply entrenched socio-cultural barriers. In numerous villages, banking correspondents (BCs)—the foot soldiers of India’s rural financial architecture—are overburdened, undertrained, and often unsupported by robust technological infrastructure. The notion that a biometric fingerprint or a one-time password could substitute for financial literacy is naïve at best. Many beneficiaries, especially women, face systemic exclusion, not just due to lack of documentation, but because patriarchal norms often discourage or control women’s interactions with banking services. Moreover, while financial inclusion aims to integrate the rural poor into the formal economy, the informal credit system continues to flourish. This coexistence is not accidental but symptomatic of a trust deficit and functional inefficiencies within formal institutions. Local moneylenders, albeit exploitative, offer immediacy and familiarity, elements often absent in bureaucratic banking processes. The digital push, accelerated post-2016 demonetization and COVID-19, has undoubtedly expanded the ecosystem. However, digital penetration without digital comprehension can widen the exclusion gap. Without focused digital education, grievance redressal mechanisms, and gender-sensitive outreach, financial inclusion may remain more rhetorical than real. In essence, true inclusion cannot be measured merely by the number of accounts opened but must reflect active participation, trust, and accessibility across gender, literacy, and regional lines. Until then, the dream of a financially empowered rural India will remain aspirational.
According to the passage, what is the main paradox of financial inclusion in rural India?
- (a)Lack of infrastructure
- (b)Overreliance on technology
- (c)Access without actual usage
- (d)Excess of digital banking
Answer
Why
Correct — C. The passage says it presents a paradox, then states it: Yet, in practice, access does not necessarily translate into utility.
On paper, the schemes have revolutionized access. In practice, a significant number of rural account holders remain dormant users.
Accounts opened but not used is Access without actual usage, option (c).
Why the others are wrong
- (a)Lack of infrastructure — Lack of infrastructure is one cause the passage gives for dormant accounts, next to digital illiteracy and socio-cultural barriers. A cause of the problem is not the paradox itself.
- (b)Overreliance on technology — Overreliance on technology echoes the doubt that a fingerprint or one-time password could substitute for financial literacy. That is a supporting criticism, not the paradox of access without use.
- (d)Excess of digital banking — Excess of digital banking is never claimed. The passage says the digital push has undoubtedly expanded the ecosystem, and its worry is penetration without comprehension, not too much banking.
Concept
A paradox question asks for the contradiction, not a cause. Here the two halves are access, which the schemes have widened, and use, which has not followed.
The passage returns to it at the close: true inclusion cannot be measured merely by the number of accounts opened but must reflect active participation.
Digital illiteracy, overburdened banking correspondents and patriarchal norms explain why access fails to become use. They are causes, not the paradox.
Options (a) and (b) draw on real points in the passage, which is what makes them tempting. The question asks for the main paradox, so the answer must hold two opposed halves.
Key facts
- The passage states its paradox as: access does not necessarily translate into utility.
- It names digital illiteracy, infrastructural limitations and socio-cultural barriers as constraints on rural account holders.
- Its measure of true inclusion is active participation, trust and accessibility, not the number of accounts opened.
Study next
Common traps
- Picking a cause the passage lists, such as infrastructure, when the question asks for the paradox.
- Choosing an option that overstates the passage: it calls the digital push an expansion, never an excess.
The same passage is tested at 17 Sep 2025, 12:30, English Q.18 (informal credit persists through the trust and familiarity of local lenders) and English Q.21 (cultural factors hinder women's financial agency).
16 Sep 2025, 09:00, English Q.16 asks for a paradox in another passage and keys fluency that can still lead to miscommunication: two things that should go together and do not.
Related PYQs
No directly related past PYQ was found.