What is Financial Inclusion? The academic literature has adequately discussed the close relation between financial development and economic growth. However, there has not been much discussion on whether financial development implies financial inclusion. It has been observed that even well-developed financial systems have not succeeded to be all-inclusive and certain segments of the population remain outside the formal financial systems. The importance of an inclusive financial system is widely recognized in the policy circle and financial inclusion is seen as a policy priority in many countries. An inclusive financial system is desirable for many reasons. First, it facilitates efficient allocation of productive resources. Second, access to appropriate financial services can significantly improve the day-to-day management of finances. And third, an all-inclusive financial system can help reduce the growth of informal sources of credit (such as moneylenders) which often tend to be exploitative. Thus, an all-inclusive financial system enhances efficiency and welfare by providing avenues for secure and safe saving practices and by facilitating a whole range of efficient financial services.