National and Personal Empowerment through Financial Literacy

India has awakened to the fact that real education is more than just covering the prescribed syllabus and has become more cognizant of the value of hands-on learning. There is a greater impetus towards inculcating practical skills be it vocational training, physical education or other more unconventional subjects. However, one area that still needs to be addressed is Financial Literacy. Statistics show that the financial literacy rate of India stands at a dismal 27 per cent and it has been the cause of ruin for thousands of families due to unwise financial decisions.

As per the latest studies, only 1 out of 5 Indians is financially literate so its effects are not just seen among the disadvantaged or marginalised communities where it has exacerbated social inequality, but are widespread among the middle and upper middle classes as well. Financial literacy is necessary even for something as basic as opening a bank account or applying for a loan. It’s also essential for people to be able to avail the various financial schemes set up by the government such as the Stand Up India Scheme and Pradhan Mantri Jan Dhan Yojana. Lack of financial literacy perpetuates vulnerability to scams, incurs bad debt and leads to poor investments which in turn,  result in income disparities and hamper overall economic growth.

Many hard-working Individuals end up with high debt due to financial mismanagement, resulting in personal hardships and poor retirement planning. This also has an adverse impact at a macro level as it leads to low investment rates, poor capital formation and limited resources for productive activities. It also results in unsatisfactory financial market participation, poor entrepreneurship and the inability to start or manage businesses successfully.  It boils down to limited jobs, stunted innovation and low economic productivity. It also hampers access to proper channels and resources for financial needs which greatly inhibits robust economic activity. Financial illiteracy leads to poor investment decisions, lack of savings, underinvestment and eventually slows down economic development.

The good news is that today Indians have various options to enhance their financial literacy. Smartphones have multiple applications and tools necessary for people to engage in self-paced learning specific to their individual needs. These resources can be accessed at any time and anywhere. Financial influencers on social media are able to connect with the younger generation and increase awareness about topics such as investments and savings in a simple and relatable manner. However, these platforms are in need of stringent vetting to ensure their accuracy and reliability. Also, they target a specific demographic rather than catering to a broader audience. The need of the day is comprehensive financial applications that include topics like investing, budgeting, debt management and retirement planning for different cohorts. 

India is an economy that is growing fast and its young workforce is undisputedly bringing a lot to the table with investment and trade opportunities. But if we truly want to be at par with global superpowers, we have to ensure the overall development of the population, of which financial literacy is an integral part. This is the only way India can truly shine and reduce the economic disparity among the working population.


  • Financial Literacy In India: The Key To National And Personal Growth | Your Story | July 2023
  • 3 reasons why only 17% of teenagers are financially literate in India | Mint Genie | October 2022
  • India’s Growing Financial Literacy | India Brand Equity Foundation | January 2022
  • Importance of Financial Literacy in India | Career Launcher

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