Does financial inclusion reduce social crimes? A panel study of crimes against women and Scheduled Castes (SCs) in India

The incidence of social crime affects economic growth and social fabric in a democratic country like India. Based on this understanding, this study endeavours to examine the role of financial inclusion (FI) in reducing social crime, specifically crime against women and Scheduled Castes (SCs), across 25 states of India during 2001–2024. Using six diverse indicators of FI and applying the principal component analysis method, this study constructs a single composite index of FI across the Indian states. By utilizing the Feasible Generalized Least Squares and the Panel-Corrected Standard Errors methods, this study reveals that FI reduces crime against women and SCs. These findings indicate that FI brings more economic empowerment and bargaining power among women and SCs in society, which helps to reduce crime against them. The results from the control variables reveal that road length, literacy rate, and unemployment reduce social crime, while social sector expenditure deepens social crime.