Abstract
During last couple of decades, the credit from formal banking institutions has shown tremendous growth in volume and complexity, yet, a large segment of the population, especially the poor, is still excluded from the formal banking services, which led affecting income inequity. In India despite of expansion of formal credit, still large segments of the population, especially the poor are excluded from the formal banking services. The performance of the entities created to support the excluded segment also not impressive, though many people have different opinions on this. Therefore, there is need to establish the relationship empirically and examine whether such institutions indeed provide credit support for improving household economy of excluded group as well as poor households of other groups.