A Financial Education Hand Book was released in 11 regional languages by the National Centre for Financial Education (NCFE) as a part of its third foundation day on September 3 to boost the efforts of the organisation in spreading financial literacy to the nook and corner of the country. To facilitate the visually-challenged, the book was also released for Braille readers.
Three years back, the NCFE was promoted jointly by the apex financial institutions of the country, namely, Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority of India (IRDAI) and Pension Fund Regulatory and Development Authority (PFRDA) with the sole objective to create financial awareness and empowerment through financial education.
The organisation is striving hard to achieve its objectives through seminars, workshops, conclaves, training, programmes, campaigns, discussion forums with/without fees by itself or with help of institutions, organisations and provide training in financial education and create financial education material in electronic or non-electronic formats, workbooks, worksheets, literature, pamphlets, booklets, fliers, technical aids and to prepare appropriate financial literature for target-based audience on financial markets and financial digital modes for improving financial literacy.
According to a consortium of researchers, 2.5 billion adults, nearly half the world’s 4.7-billion adult population, are not aware of the use of formal financial services or the concepts of savings and investment. Around 2.2 billion of these financially-illiterate adults live in Asia, Africa, Latin America and Middle East.
The OECD/INFE International Survey of Adult Financial Literacy Competencies revealed that only 42per c ent of adults are aware of the compounding interest on savings and 58per c ent are able to calculate simple interest.
Knowledge of household budget is known to 60per c entadults and only 50per c ent are having long-term investment. In India, the financial literacy status is a very discouraging one. According to an S&P Survey, more than 75per c ent of Indian adults do not understand basic financial concepts. More than 80per c ent of our female population are financially-illiterate.
In this background, a thrust on a national strategy for financial education becomes essential and the National Centre for Financial Education (NCFE) prepared the NSFE 2020-25 in consultation with the apex financial sector regulators, RBI, SEBI, IRDAI and PFRDA. The RBI has constructed an FI-Index to capture the extent of financial inclusion across the country which is published annually in July every year.
The annual FI-Index for the period ending March 2021 is 53.9 as against 43.4 for the period ending March 2017 shows the result of the combined efforts of all the financial institutions in general and the NCFE in particular. The coverage of financial literacy was increased by almost 10per cent during the last three years. The opening of Pradhan Mantri Jan-Dhan Yojana accounts has enabled millions of Indians to access the banking facilities, but mere opening of bank account is not enough.
Unless the people of the country are digitally financial literate, they cannot reap the benefits of financial inclusion. The NCFE is playing a great role in spreading the financial literacy to the last layer of the society.
The website of NCFE is a perfect place for all financial education literature and information. Apart from this, the Financial Education Trainers of NCFE are conducting financial literacy programmes for the adult population of the country in the Aspirational Districts identified by the NITI Aayog.
Financial education material for FEPA was developed by the NCFE in all regional languages and is given to the participants of these programmes free of cost which explain topics like Income, Expenses and Budgeting, Savings, Banking, Credit and Debt Management, Digital Transactions, Insurance, Investment, Retirement and Pensions, Financial inclusion schemes of the Government, Fraud protection, Grievance Redressal, etc.
A Financial Education Training Programme (FETP) is conducted for schoolteachers of Class-VI who will be certified as ‘Money Smart Teachers’ and will facilitate conducting financial education classes in schools with an aim to provide basic financial skills to the students.
A Money Smart School Programme (MSSP) is another ambitious programme of the NCFE which invites schools to introduce financial literacy in the curriculum.
Many States have already introduced this and the NCFE prepared the study material jointly with the CBSE. FACT (Financial Awareness and Consumer Training) is a programe by the NCFE which aims at imparting financial education to graduates and postgraduates. It is also offering an e-learning course on basic financial education covering topics from Banking, Securities Markets, Insurance and Pension Products.
With all these ambitious programmes, the NCFE is striving hard to come up to the expectations of its promoters in making ‘a financially- aware and empowered India.
In order to cultivate financial knowledge among youths, the Investor Education and Protection Fund Authority is exploring the possibility of organising a three-month campaign named IEPFA-NEVSA-Niveshak Evam Vittiya Saksharta Abhiyan with the help of Ministry of Education.
The UGC wrote a letter to all the universities in the country to undertake activities involving NSS volunteers to spread financial education to every nook and corner. The objective of this campaign is to utilise the student community to spread the Investor Awareness Messages more effectively as they can act as a vehicle of change and propagate the financial education.
It is useful in two ways as the volunteers while acting as catalyst they will learn themselves the benefits of financial education and rise with a solid foundation for building sound financial behaviour.
If the initiatives of all these organisations can be implemented in the right way, our youths can become responsible citizens with necessary skills in all financial matters like savings, insurance, budgeting, investment and pension planning that result in a safe and secure life.
(Dr Biswal is Head, Department of Commerce, Nowrangpur College, Nabarangpur, Mob: 9437125286, bhaskarnathbiswal@gmail.com)