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VOL. 8, ISSUE 1 (2026)
Financial inclusion and women entrepreneurship in Bihar, India: The mediating role of microfinance institutions
Authors
Shaista Mazhar, Dr. Joshy K J
Abstract
This study investigates the multidimensional relationships between financial inclusion, microfinance institutions (MFIs), and women’s entrepreneurship in Bihar, India. Using a cross-sectional survey design with multi-stage stratified random sampling, data were collected from 320 women entrepreneurs through face-to-face structured interviews employing a 75-item instrument across six constructs: awareness, usage, and access (financial inclusion dimensions) and availability, acceptability, and affordability (MFI dimensions). Reliability analysis confirmed excellent internal consistency (α = 0.751–0.898; overall α = 0.965). Principal component analysis validated construct measurement (cumulative variance: 68.92%–74.85%). Multiple regression revealed that usage is the primary determinant of financial inclusion’s influence on entrepreneurial activity (β = 0.421, p <.001), with the full model explaining 58.3% of variance. Baron and Kenny mediation analysis confirmed by Sobel tests (z = 5.89, p <.001) demonstrated that MFIs partially mediate the financial inclusion–entrepreneurship relationship, accounting for 37.7% of the total effect. Hierarchical regression showed MFI dimensions explain an additional 15.5% variance in financial sustainability (ΔR² = 0.155, p <.001), with availability (β = 0.298) and affordability (β = 0.267) as the strongest predictors. Results highlight the importance of active service use over access as an important step to meaningful financial inclusion. The policy recommendations of putting into practice usage-enhancement programs, expanding MFI, and implementing gender-sensitive financial literacy are mentioned.
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Pages:89-98
How to cite this article:
Shaista Mazhar, Dr. Joshy K J "Financial inclusion and women entrepreneurship in Bihar, India: The mediating role of microfinance institutions". International Journal of Commerce and Economics, Vol 8, Issue 1, 2026, Pages 89-98
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