Financial Inclusion and Women’s Empowerment: Evidence from  Self-Help Groups in a Backward District of Assam

Women’s empowerment has been widely accepted as an inherent aspect of inclusive development; however, the extent to which financial inclusion programs can lead to substantive empowerment remains debatable. This paper explores how financial inclusion through Self Help Groups (SHGs) has contributed to the economic empowerment of women in the South Salmara Mankachar district of Assam, one of the regions with severe socio-economic challenges. Based on primary survey data, the study develops two composite indices to quantify women's economic empowerment in the household and community spheres, respectively. The findings indicate that participation in SHGs has a strong positive impact on the economic empowerment of women within the household, particularly control over income, participation in financial decision-making, and autonomy to spend on the basic needs of themselves and their children. Nevertheless, the effects of SHGs on community-level empowerment outcomes remain limited, suggesting that individual gains do not necessarily translate into community level empowerment. The paper highlights the heterogeneity of empowerment outcomes and argues that financial inclusion in itself cannot produce transformative empowerment without supporting institutional and structural measures.