“Public Sector Banks as Agents of Rural Transformation: An Empirical Investigation into CSR and Socio-Economic”

Abstract

This empirical investigation examines the role of Public Sector Banks (PSBs) in catalyzing rural transformation in India, with a specific focus on Corporate Social Responsibility (CSR) initiatives and key socio-economic indicators within Karnataka. Rural India’s development continues to hinge on inclusive financial intermediation and effective deployment of socio-economic interventions; PSBs have been central to this process through financial inclusion, targeted credit, and CSR programs aimed at employment creation, education, infrastructure, and livelihood enhancement. Utilizing a mixed-methods approach, this study analyzes primary survey data (n = 50 rural households across three districts of Karnataka) and secondary government data on banking penetration, credit disbursement, and rural socio-economic indicators. Findings reveal a significant correlation between PSB presence, CSR-linked development initiatives, and improvements in rural welfare outcomes including income levels, asset ownership, women’s financial participation, and access to formal credit. CSR activities by PSBs such as micro-enterprise support, financial literacy drives, and infrastructure investments emerge as influential but uneven across regions. Statistical analysis demonstrates positive trends in financial inclusion metrics, while qualitative insights underscore gaps in outreach and impact measurement. Key recommendations include enhancing CSR alignment with local needs, bolstering PSBs’ operational capacity in underserved areas, and integrating rural socio-economic data analytics into CSR planning. By contextualizing PSBs’ contributions within Karnataka’s rural development paradigm, the study contributes to policy discourses on financial inclusivity and sustainable rural transformation.