Women empowerment represents an elusive and multi-dimensional process that is integral in accomplishing the intended outcomes of sustainable development. Being a critical dimension of inclusive development strategy, it encompasses more than financial independence of women to materializing economic agency, social networking, capability enhancement and socio-cultural transformation. It is in this context that financial inclusion initiatives providing women with greater opportunities for economic participation and decision-making, are envisaged as constructive tools for achieving many sustainable development goals including gender equality, reduced inequalities, decent work and economic growth. The present study examines the nexus between grassroots economic participation, financial inclusion, and women’s empowerment. Drawing on field derived secondary data evidences from women in Kerala related with their engagement with grassroots economic participation in initiatives like Mahatma Gandhi National Rural Employment Programme (MGNREP), Self-Help Groups (SHG) and Kudumbashree, the study examines how the participation in such initiatives strengthen women’s economic agency and social capital, contributing to their economic and socio-cultural empowerment. The findings of the study highlight the fact that effective community participation and associated financial engagement not only empower women economically but also enhances the capacity to utilize their economic agency to have better choices within and outside the domestic sphere, contributing more to the larger goals of empowerment. The study also underscores the relevance of identifying critical implementation gaps and revitalizing existing policy initiatives to ensure that institutional interventions are better aligned with specific regional needs and local contexts.