In a country where only 27% of adults have a basic level of financial literacy, it would be an issue for the education system and economic growth. The goal of India to have a 5 trillion economy can't be achieved without educating people about finance and money.
Financial participation of the population in the country has been one of the important developmental agendas of both the Government of India and the four financial sector regulators. Financial literacy empowers consumers to make informed choices leading to their financial well-being.
The first program to create more financial awareness was first launched in the year 2013 named National Strategy for Financial Education (NSFE).
The audience of programs
A one-size-fits-all approach can't assure the desired learning curve while educating the population about the basics of finance. It requires a dimensional approach to bring the best out of NSFE (2020-2025)
Dimension 1. Life stages of target segments - Children, young adults, female senior citizens.
Dimension 2. Geographical social groups - Rural areas, poor & migrant urban population, and migrants, persons with disabilities of Andaman & Nicobar Islands and Lakshadweep.
Dimension 3. Sector-specific focus - Agriculture, manufacturing, and self-employed sector.
Vision and strategic objectives of NSFE (2020-2025)
The program has been launched with the vision of financially aware and empowered India. It has 9 revised strategic objectives that reflect the economic changes. Objectives proved a revived momentum to promote financial education.
- Teach financial literacy concepts to the various sections of the population.
- Encourage active savings behavior.
- Encourage participation in financial markets to meet financial goals and objectives.
- Develop credit discipline and encourage availing credit.
- Improve usage of digital financial services in a safe and secure manner.
- Manage risk through relevant and suitable insurance cover.
- Plan for retirement with the scope of suitable pension products.
- Knowledge about rights, duties, and ways for grievance redressal.
- Improve research and evaluation methods to assess progress in financial education.
5C approach of NSFE (2020-2025)
Content
Financial literacy content for school children, and teachers including the curriculum. Creation of content that can be delivered through audio-video, print, mass media, and digital format to specific target audiences.
Capacity
Strengthen the capability of SHG leaders, Bank Sakhis, who can help in extending financial literacy and train secondary school teachers for the same. Also, the development of a ‘Code of Conduct for financial education providers.
Community
Evolve community-led approaches for sustainably communicating financial literacy.
Communication
Use technology, mass media channels, and innovative ways of communication for financial education messages while leveraging public places with greater visibility for meaningful financial literacy messages.
Collaboration
Information dashboard with the integration of financial education content in the school curriculum, and vocational courses.
When the government and the central bank are taking such major steps toward the financial literacy of our young population, it's our responsibility to promote financial literacy. Financial literacy is not just the education of money, it’s an education to lead a financially stable life and contribute to the nation's economy.
Anushka Trivedi is a freelance financial content writer. She can be reached at anushkatrivedi.com