Financial inclusion is one of the most important development policy priority in India. Still across the states there exists barriers to the access of formal finance. These barriers include: geographical distance to access the banking services, availability of few bank branches in densly populated area, lack of information about various financial products, problem of opening a basic account and low awareness about banking service. This study attempts to analyse the role of various innovative financial inclusion policies and its impact on financial inclusiveness among the Indian states. The study utilized banking outreach services, supply side data, from 1974 to 2018 to measure financial inclusion, by constructing an index of financial inclusion. Further, the study analysed the effect of three phases of financial inclusion policies. We find that, social banking policy (1974-1990) had resulted in an increase in branch network coverage and new innovative financial inclusion policy phase (2005-2018) had an enormous growth in deposit accounts per capita, but during the financial reform period (1991-2004) there was low growth in overall banking outreach services. India’s new financial inclusion policy the implementation of new banking technology, no-frill account, liberalization of the banking services have brought more financially excluded people into inclusion category in terms opening the basic bank accounts but credit coverage has not increased by the same proportion. Our results show that policy makers need to focus more on setting up financial literacy centres and create awareness about banking services among the poor rural population. Further, banks need to sanction more ‘production loans’ to priority sector and all categories of the people, which should be timely and adequate. These in turn would enhance the level of financial inclusion in the future.