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A project report

On

Financial literacy

FOR

RESERVE BANK OF INDIA

Bhubaneswar

BYBY

PADMINI PRIYADARSHINI MISHRAPADMINI PRIYADARSHINI MISHRA

IN PARTIAL FULFILLMENT OFIN PARTIAL FULFILLMENT OF

MASTER OF FINANCE AND CONTROLMASTER OF FINANCE AND CONTROL

ASMIT, BBSRASMIT, BBSR

External guide Internalguide

Mr.P.K.Jena Mrs.Anamika PattnaikDGM financefaculty Reserve Bank of Indiaasmit


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acknowledgement

A Summer project is a golden opportunity for learning and self

development. I consider myself very lucky and honoured to have so many

people lead me through in completion of this project.

My grateful thanks to Mr.P.K.Jena, DGM, RBI, who in spite ofbeing extraordinary busy with his duties, took time out to hear, guide, and

keep me on the correct path. A humble Thank you Sir.

The study could not have been done without the support of

Dr.A.K.Mohapatro, AGM, RBI. My deep sense of gratitude to

Mr.M.Chandrasekharan, DGM, RBI. I would also like to thank Mr. Sridhar

Behera, Assistant Manager for providing necessary material and shaping

the course to its successful completion.

Thanks and appreciation to the helpful people at RBI, for their

support.

Mrs Anamika Pattnaik, Faculty of Finance whose patience I have

probably tested to the limit. She was always so involved in the entire

process, shared her knowledge and encouraged me to think. Thank you,

Dear Madam. I would also like to thank our Institution (ASMIT) for

helping me to get such an excellent opportunity.

Last but not the least, there were so many people who shared valuable

information that helped me in successful completion of this project.

Date: PadminiPriyadarshini Mishra

Place: Bhubaneswar Summertrainee 2010

DeclarationReserve Bank of India 2


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I hereby declare that the project work entitled Financial literacy

submitted to the Utkal University is a record of an original work done by

me under the guidance of Mr.P.K.Jena, DGM, Reserve Bank of India, Mrs.

Anamika Pattnaik, Finance Faculty of Arya School Of Management and

IT. This project work has not formed the basis for the award of any degreeor diploma/ associateship /fellowship and similar project, if any.

Date PadminiPriyadarshini Mishra

Place:Bhubaneswar Roll No:

13767U0930

CONTENT

CHAPTER:1 6-14

(a) Preface 7(b) Introduction- 9(c) Objective - 12

(d) Methodology - 12

Reserve Bank of India 3


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(e) Limitation - 14CHAPTER: 2..15 -18

Central Bank Profile -17-18

CHAPTER: 3..19

58(a) Financial Education - 20(b) Financial literacy as a means

to financial inclusion- 22(c) Importance - 23(d) Financial Literacy: An Intern-

-ational context 26(e) OECD 29(f) Financial literacy: Indian context 30(g)Need

32(h)Challenges 34(i) Possible Themes 35(j) Issues

36(k)Scope

37(l)Initiative taken by RBI 39(m) Initiative taken by GOVT 57

CHAPTER:4 59-71 Data analysis and interpretationCHAPTER : 572-

77(a) Findings 73(b) Suggestion 75(c) Conclusion 77

CHAPTER :6.79- 83

Bibliography 80Reference 81



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Appendix 82



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preface

Inclusive growth:Indias post 1990s economic growth has made it one of the worlds fastest

growing economies in the world. Its GDP growth rates of up to about 9%

in the last few years are historically unparalleled except by the

neighbouring China. With the rapid growth rates, however, come new

challenges and new questions. One such challenging question concerns the

spread of the benefits of growth across different segments of society.

To ensure that growth has been well distributed, Indias PlanningCommission has made Inclusive Growth the explicit goal in the Eleventh



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five-year plan. The concept of Inclusive Growth has dominated discussions

across India.

Inclusive growth implies an equitable allocation of resources with

benefits accruing to every section of society. It is the indisputable way to

reform the regional imbalances and strengthen the economic gains. It is

otherwise called as Broad-based growth, Shared growth and Pro-poorgrowth. The major objective of inclusive growth is to ensure that the

benefits and fruits of growth reach to the bottom of pyramid. Inclusive

growth can be achieved, inter alia, through financial inclusion.

FINANCIAL INCLUSION:

Financial inclusion is delivery of banking services at an affordable cost to

the vast section of disadvantaged and low income groups. The various

services include savings, loans, insurance, remittance facilities and

financial counselling, advisory services by the formal financial system. It

is the process of ensuring access to financial services and timely adequate

credit needed by vulnerable groups such as weaker sections and low

income groups at an affordable cost (Rangarajan Committee on Financial

Inclusion).

Financial literacyplays a very crucial role inachievement of 100 per cent financial inclusion. It helps in developing

personal financial management skills and financial operational skill to

make financial inclusion successful.

Lower income groups or the poor people depend upon the

informal financial sources i.e. private money lenders for their financial

needs. Different types of risk are always associated with their lives likedeath, accident, sickness or natural disaster like flood, cyclone, fire etc.

They need to be protected from the above risks .They also want to save

in order to meet their future needs. But they were unable to do so

because of lack of awareness about financial products and services.

Also their unsound financial position obstructs the way. It is the

financial literacy which would generate awareness amongst different

population groups.



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Financial literacy plays a significant role in effective allocation of

household savings and ability of individuals to meet their financial goals. It

also means the ability to seek sound financial advice. In India the need for

financial literacy is even greater considering the low levels of literacy and

the large section of the population, which still remains out of formal

financial set-up.

For sustaining financial inclusion, the financial literacy becomes avery critical component. Research findings revealed that the low level of

financial literacy is one of the reasons why the financial inclusion drive has

not picked up. While ensuring that the entire unbanked population of India

becomes financially literate seems like a formidable task, ensuring that the

unbanked population hears about the drive, the benefits of a savings

account and how to use one seems much more achievable. Similarly,

studies have shown that how accounts opened through the BC model are

not being used, after account opening. Certainly, innovative forms ofmarketing which explain the product in simple terms so that target account

holders understand the account and its benefits should go a long way.

Credit Counselling Centres:

The RBI has asked both the private as well as public sector banks to set up

more financial literacy and credit counselling centres in every district and

has suggested the lead banks to hold a public meeting every quarter in each

district to address grievances of the bank customers. These centres should

provide both pre and post counselling.

The counselling centres should have the facility for online submission

of applications, which may be forwarded to branches. Quality of services

is an important aspect and also having a system of accreditation of

counsellors. While the financial literacy and credit counselling centres

would provide financial literacy and credit counselling, the activities of

rural development and self employment training institutes (RUDSETI)

towards skill development\capacity building could be dovetailed withFLCCs initiatives, for increasing the earning / debt repaying ability of the

distress borrowers families.

While credit counselling services may be provided by banks both in

rural and urban area, it is observed that a large section of Indian population

is resident in rural areas with literacy level lower than in urban areas. The

rural population is also mere dependent on the informal sector for its

financial needs. It is necessary that a segmented approach, rather than

broad based generalized approach to counselling for all type of borrowers,



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is adopted. The centres in rural areas could concentrate on financial

literacy and credit counselling for farming communities and those engaged

in allied activities. The centres in urban areas could focus on individuals

with overdue in credit cards, personal loan, housing loans etc.

A great deal of emphasis needs to be given by all the institution to

educate the public of the various schemes / facilities. All forms of publicitylike press conference, workshops, publications, websites, road shows,

mobile units, village fair should be actively explored. A suitable budget

needs to be provided by all banks for the purpose. In order to go ahead in a

planned manner, a High Level Council on financial literacy and

counselling may be setup with the members from Reserve Bank,

NABARD, IBA, BCSBI , CIBIL, NGOs working in the area and consumer

organizations; this will foster greater collaboration in the areas relating to

consumer education and protection of consumers interest.

Various steps taken:

Mobile Literacy Vans: The vehicles are intended to take the rural and

semi-urban branches to village door steps and remote areas. Doorstep

counselling and guidance is through the educative material and pamphlets

to create awareness among the remote rural masses about bank schemes

and banking facilities.

Utilizing NGOs: As recommended by the working groups on

rehabilitation of Sick SMEs (Chairman: Dr. K. C. Chakarabarthy, April

2008), a scheme for utilizing specified NGOs for providing the following

services

Training in basic accounting principles and credit management

Training on marketing, technology, design development, packaging,

quality control etc.

Creation and development of institutions borrowers like cooperative

Participation in exhibitions and marketing fairs.

Development of common facilities for a group

Providing financial assistance for infrastructure creation



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Methodology

The objective of this project is to do make various target groups financially

literate, developing personal financial management skill and financial

operation skill.

INFORMATION SOURCES

PRIMARY DATA SOURCES:

Reserve Bank of India website various speeches, bulletins etc.

Interview of 50 sample population

SECONDARY DATA SOURCES:

Books:

Improving Financial literacy- OECD Publishing Speeding of financial inclusion- Sameer Koucher

www.rbi.org.in

www.google.co.in

en.wikipedia.org

various articles on financial literacy

DATA COLLECTION TOOLS

Discussions with various agencies promoting financial literacy campaign

and various target groups (school and college going children, women, rural

and urban poor defence personnel and senior citizen). Questionnaires were

used to record data.



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India Act, 1934.The Central Office of the Reserve Bank wasinitially established in Calcutta but was permanently movedto Mumbai in 1937. The Central Office is where theGovernor sits and where policies are formulated. Thoughoriginally privately owned, since nationalisation in 1949,the Reserve Bank is fully owned by the Government of

India.

The Preamble of the Reserve Bank of India describes thebasic functions of the Reserve Bank as:"...to regulate theissue of Bank Notes and keeping of reserves with a view tosecuring monetary stability in India and generally tooperate the currency and credit system of the country to itsadvantage."

The Reserve Bank of India is the central bank of the countryentrusted with monetary stability, the management ofcurrency and the supervision of the financial as well as thepayments system. Established in 1935, its functions andfocus have evolved in response to the changing economicenvironment. Its history is not only intrinsically interwovenwith the economic and financial history of the country, but

also gives insights into the thought processes that havehelped shape the country's economic policies. Some facetsof the Bank's history for the laypersons are as follows:

The Reserve Bank of India is the central bank of thecountry. Central banks are a relatively recent innovationand most central banks, as we know them today, wereestablished around the early twentieth century. TheReserve Bank of India was set up on the basis of therecommendations of the Hilton Young Commission. TheReserve Bank of India Act, 1934 (II of 1934) provides thestatutory basis of the functioning of the Bank, whichcommenced operations on April 1, 1935.The Bank began itsoperations by taking over from the Government thefunctions so far being performed by the Controller ofCurrency and from the Imperial Bank of India, themanagement of Government accounts and public debt. Thecurrency offices at Calcutta, Bombay, Madras, Rangoon,



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Karachi, Lahore and Cawnpore (Kanpur) became branchesof the Issue Department. Offices of the BankingDepartment were established in Calcutta, Bombay, Madras,Delhi and Rangoon. Burma (Myanmar) seceded from theIndian Union in 1937 but the Reserve Bank continued to actas the Central Bank for Burma till Japanese Occupation of

Burma and later up to April, 1947. After the partition ofIndia, the Reserve Bank served as the central bank ofPakistan up to June 1948 when the State Bank of Pakistancommenced operations. The Bank, which was originally setup as a shareholder's bank, was nationalised in 1949.Aninteresting feature of the Reserve Bank of India was that atits very inception, the Bank was seen as playing a specialrole in the context of development, especially Agriculture.

When India commenced its plan endeavours, thedevelopment role of the Bank came into focus, especially inthe sixties when the Reserve Bank, in many ways,pioneered the concept and practise of using finance to

catalyse development. The Bank was also instrumental ininstitutional development and helped set up institutions likethe Deposit Insurance and Credit Guarantee Corporation ofIndia, the Unit Trust of India, the Industrial DevelopmentBank of India, the National Bank of Agriculture and RuralDevelopment, the Discount and Finance House of India etc.to build the financial infrastructure of the country. With

liberalisation, the Bank's focus has shifted back to corecentral banking functions like Monetary Policy, BankSupervision and Regulation, and Overseeing the PaymentsSystem and onto developing the financial markets.



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Financial EducationOrganization for Economic Co-operation and Development, financial

education is the process by which financial consumers /investors improve

their understanding of financial products, concepts and risks and through

information, instruction and/ or objective advice, develop the skills andconfidence to become more aware of financial risks and opportunities, to

make informed choices, to know where to go for help and to take other

effective actions to improve their financial well being.

The focus of any discussion on financial education is primarily on the

individual, who usually has limited resources and skills to appreciate the

complexities of financial dealings with financial intermediaries on matters

relating to personal finance on a day-to-day basis. The process of

economic reforms have educating and empowering the common person to



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participate in the financial marketplace with knowledge and confidence, as

a critical component of public policy.

The need for financial education is felt in the developed and the

developing countries alike. In the developed countries, the increasing

number and complexity of financial products, the continuing shift in

responsibility for providing social security from governments and financialinstitutions to individuals, and the growing importance of individual

retirement planning make it imperative that financial education be

provided to all.

In the developing countries also, the increasing participation of a growing

number of consumers in newly developing financial markets necessitates

the provision of financial education if these markets are to expand and

operate efficiently. In addition, the substantial growth of international

transactions during the last decade, resulting from new technologies and

the growing international mobility of individuals, makes the improvement

in financial education, increasingly, an international concern.

From a regulatory perspective, financial education empowers the common

person and thus reduces the burden of protecting the common person from

the elements of market failure, attributable to, de facto, information

asymmetries. For example, the emphasis on market discipline, as one of

the three pillars of banking regulation, especially under Basel II, is bestserved by participation of financially literate bank customers in the

financial marketplace.

Financial education can make a difference not only in the quality of life

that individuals can afford, but also the integrity and quality of markets. It

can provide individuals with basic tools for budgeting, help them to

acquire the discipline to save and thus, ensure that they can enjoy a

dignified life after retirement. Financially educated consumers, in turn, can benefit the economy by encouraging genuine competition, forcing the

service providers to innovate and improve their levels of efficiency.

Todays complex financial services market offers consumers a vast array

of products and providers to meet their financial needs. This degree of

choice requires that consumers be equipped with the knowledge and skills

to evaluate the options and identify those that best suit their needs and

circumstances. This is especially true for populations that have

traditionally been underserved by our financial system. Financial education



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is also essential to help consumers understand how to prevent becoming

involved in transactions that are financially destructive.

Financial literacy is considered an important adjunct for promoting

financial inclusion and ultimately financial stability. Both developed and

developing countries, therefore, are focusing on programmes for financial

literacy/education.

In India, the need for financial literacy is even greater considering the low

levels of literacy and the large section of the population, which still

remains out of the formal financial set-up. In the context of 'financial

inclusion', the scope of financial literacy is relatively broader and it

acquires greater significance since it could be an important factor in the

very access of such excluded groups to finance. Further, the process of

educating may invariably involve addressing deep entrenched behavioural

and psychological factors that could be major barriers.

In countries with diverse social and economic profile like India,

financial literacy is particularly relevant for people who are resource-

poor and who operate at the margin and are vulnerable to persistent

downward financial pressures. With no established banking

relationship, the un-banked poor are pushed towards expensive

alternatives. The challenges of household cash management under

difficult circumstances with few resources to fall back on, could be

accentuated by the lack of skills or knowledge to make well informed

financial decisions. Financial literacy can help them prepare ahead of

time for life cycle needs and deal with unexpected emergencies without

assuming unnecessary debt.

Financial literacy as a meansto financial inclusion

Basically financial inclusion is the demand side and financial education is

the supply side. When the awareness for financial education will be created

among the people then they can be financially included. It can be better

understandable by the help of a diagram.

Y



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everyone participates in wealth, both in its creation and distribution. Along

with good employment prospects, financial education can play a key role

in helping individuals and families build their assets.

Just as health education in primary and secondary schools helps children

develop good life-long dietary and hygiene habits, good financial

education can provide them with the skills and habits necessary to enablethem to participate sensibly in financial markets. Moreover, well-informed

financial consumers ultimately lead to better financial markets, where

rogue products are forced from the market-place and confidence is raised.

To conclude, financial education has a role to play in so many critical areas

of everyday life:

Financing home ownership; Financing higher education; Financing retirement security;

Making people more astute when saving and investing

Protecting individuals from those who prey upon the ignorance and

greed of the unwary.

Financial literacy: An InternationalExperience

It has been said particularly in the context of the developed economies thatwhile the young do not save enough and do not fully understand the need for

investments for future, many of the elderly tend to feel the pinch of poverty. In

this background, priority needs to be accorded to financial literacy.

An international OECD study was published in late 2005 analyzing

financial literacy surveys in OECD countries. A selection of findingsincluded:

In Australia, 67 per cent of respondents indicated that they understood

the concept of compound interest, yet when they were asked to solve a

problem using the concept only 28 per cent had a good level of

understanding.

A British survey found that consumers do not actively seek out financialinformation. The information they do receive is acquired by chance, for



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example, by picking up a pamphlet at a bank or having a chance talk with a

bank employee.

A Canadian survey found that respondents considered choosing the right

investments to be more stressful than going to the dentist.

A survey of Korean high-school students showed that they had failing

scores - that is, they answered fewer than 60 per cent of the questions

correctly - on tests designed to measure their ability to choose and manage

a credit card, their knowledge about saving and investing for retirement,

and their awareness of risk and the importance of insuring against it.

A survey in the US found that four out of ten American workers are not

saving for retirement.

In Israel, a study is underway into current financial literacy

So for solving these problems different countries have taken important

decisions and opened many institutions. Such of the examples are :-

U.K

In the UK, the Financial Services Authority (FSA) has launched the

biggest ever campaign to improve the financial skills of the population and

imparting education to enable a better appreciation of the risks and rewardsinherent in financial instruments.

U.S.

The US Treasury established its Office of Financial Education in 2002.

The Office works to promote access to the financial literacy tools that can

help all US citizens make wiser choices in all areas of personal financialmanagement, with a special emphasis on saving, credit management, home

ownership and retirement planning. The Financial Literacy and Education

Commission (FLEC),established by the Congress in 2003 through the

passage of the Financial Literacy and Education Improvement Act, was

created with the purpose of improving the financial literacy and education

of persons in the United States through development of a national strategy

to promote financial literacy and education. The Federal Reserve, along

with numerous other federal Government agencies, is a member of thiscommission, which is supported by the Office of Financial Education.



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and complaints. These initiatives have been reinforced by high levels of

transparency and disclosure.

Organisation for Economic Co-operation and Development

Above all, The Organization for Economic Co-operation and Development(OECD) has been taking a pro-active initiative in generating awareness

about financial literacy. It has recently released a major international study

on financial literacy titled 'Improving Financial Literacy' encompassing

practical guidelines on good practices in financial literacy and awareness.

These guidelines, in the form of a non-binding recommendation, are

designed to help countries devise and implement effective financial

literacy programmes, drawing from the best practices in this area in OECD

countries.

They promote the role of all the main stakeholders in financial literacy:

governments, financial institutions, employers, trade unions and consumer

groups. In addition, they also draw a clear distinction between public

information provided by the government and regulatory authorities, and

that supplied by the financial analysts.

It is also important to devise ways to ascertain whether financial literacyhas achieved its objective, such as generating increased consumer

awareness or a changed behaviour. The balance of evidence, however,

suggests that such programmes tend to be effective. For instance, in the

United States, it has been observed that workers increase their participation

in retirement savings plans funded by employee and employer

contributions when the latter offers financial literacy programmes, whether

in the form of brochures or seminars. Consumers who attend one-on-one

counselling sessions on their personal finances have fewer delinquencies.

FINANCIAL LITERACY: AN INDIANContext

Prior to the initiation of financial sector reforms in the early 1990s, the

Indian financial system essentially catered to the needs of planned

development. Customers had little choice in financial instruments. The

segmented and underdeveloped financial markets meant that their exposure

to risk was also limited. In such a situation, customers could employ theirbasic skills to investing simple financial products with assured returns,



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and multiplies the opportunities for them to consume, save, or invest.

Having these basic financial planning skills can help families to meet their

near-term obligations and maximise their longer-term financial well-being.

Financial literacy is also an integral component of customer protection.

Despite concerted efforts, the current state of transparency coupled with

the difficulty of consumers in identifying and understanding the fine printfrom the large volume of convoluted information, leads to an information

asymmetry between the financial intermediary and the customer. For

example, customers are often penalised for minor violations in repayments,

although they have limited redressal mechanisms to rectify deficiencies in

service by banks, rendering the banker-customer relationship one of

unequal. In this relationship, it is the principal, that is, the depositor, who is

actually far less powerful than the agent, that is, the bank. The

representations received in regard to levying of unreasonably high serviceor user charges and enhancement of user charges without proper and prior

intimation, and the growing number of customer complaints against the

banks, also testify to this fact. In this context, financial literacy may help to

prevent vulnerable consumers from falling prey to financially disquieting

credit arrangements.

Need of Financial Literacy in India

As per a comprehensive survey of over 63,000 Indian households to

understand how India earns, spends and saves:

A rural households total annual expenditure, including both routine and

unusual expenditure, amounts to Rs 41,000, resulting in a surplus income

of roughly about Rs 11,000. An urban household in contrast has a surplus

income of Rs 25,000. The survey also highlights disparities in saving

habits. Levels of income, expenditure and saving related behaviour are

linked to the age, education levels and type of engagement of chief earner.

Salary and wage earners account for a low share of the total households

(18.4%) but highest share of the total earnings (30.8%) with an annual

income of Rs 109,000. After taking care of total expenses of Rs 76,000,

these households have surplus income of about 30% of their income.

By contrast, a third of households earn their income from labour, but this

groups share in the total earnings is only 16% and has surplus income just

about 7.7% of their income. Similarly, households with chief earner in late



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enhancement of financial literacy and education of households to do better

in achieving lasting financial security.

Challenges in deliveringfinancial education

Devising financial education initiatives for the un/under bankedhas to take into account the existing financial landscape, the social

economic realities of this class and the fact that invariably, such groups are

beset with low literacy levels.

The main difference in the financial planning for the poor families is that

they have fewer resources and opportunities. When people are struggling

to make ends meet on a day-to-day basis, good money management

becomes a daily challenge. While they use many creative ingenuousstrategies to manage their money, these often develop through trial and

error rather than by design. Financial education has a role in "building the

capacity of the poor to gain control, become proactive, use information and

resources to enhance their economic security and more effectively use

financial services". When better-informed clients become better consumers

of financial services, financial institutions benefit.

Further, as already mentioned, the process of educating may invariably

involve addressing deep entrenched behavioural and psychological factors

that could be major barriers. For example, in case of many of the

microfinance initiatives operating on the 'group liability' concept it could

be a great challenge to drive home the very basic rationale for such an

arrangement, starting from inculcating the habit of small savings to

appreciation of the concept of 'collective responsibility'.

A study regarding Mexican experience has highlighted that the social and

cultural factors embedded in the financial landscape greatly influence theability of individuals to use financial services effectively. Results indicate

that in addition to material resources, the inherent nature of social relations

and community links played a crucial role in improving access to and use

of financial services. The transformation of financial information,

knowledge, experience, attitudes and social relationships into financial

education and sophistication constituted a cognitive resource to reducing

vulnerability. This leads us to suggest that a culture of finance is an

important catalyst for individuals change and development.



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It is also important to note that financial education may contribute to

behaviour modification, but many factors lend to influence a persons

financial behaviour. Contrary to common belief, motivation is cultivated

internally and rarely can be cultivatedsustainably, at leastby an

external factor. The biggest obstacle to financial education is motivating

individuals to pursue it. In other words, financial education does not

necessarily motivate individuals; motivation brings individuals to financialeducation. Here the role of banks assumes importance as financial

counsellors of the clients. Financial Education means not only educate the

peoples but also give them a comfortable life which they desire.

Possible theme

Inspite of the above challenges, it should be possible to arrive at a set ofbasic themes/issues that could be addressed effectively through a financial

education program. As per a study conducted by the under the project

"Financial Education for the Poor" by Microfinance Opportunities, a

microenterprise resource centre, a consistent demand was found for the

following broad themes of financial education:

Money Management: How to proactively manage money

Debt Management: How to control debt and avoid over-indebtedness Managing Savings: How to save regularly and in a safe location Financial Negotiations: How to strengthen clients' bargaining

position vis--vis input suppliers, other household members, and

financial institutions Use of Bank Services: How banks work and impose charges; How

clients can maximize bank services, interact with banks, and

effectively use ATMs

An analysis of such programs in the OECD countries reveals that many

educational programmes are integrated into the provision of specific

financial services, such as first or basic bank accounts, checking and

savings accounts and matched-savings plans while others adopt a broad

stand-alone approach, teaching, budgeting, savings and credit

management, etc., with no connection to any product of service. Aims tend

to vary according to the majority target population.



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For the generic unbanked, aims are to explain the benefits and use of

bank account ownership and services or to build up fundamental

financial literacy skills.

For low/moderate-income underserved consumers, most

programmes offer advice on general money and credit management;

whereas others have a specific goal or are embedded in schemes to

encourage savings, asset-building and homeownership.

These initiatives aim to build economic empowerment and increase long-

term self-sufficiency in order to revitalize and stabilize disadvantaged

communities.

Issues on financial literacy

One of the major barriers in the way of delivery of financial services is thelack of basic knowledge and lack of awareness of the products and services

available from the banks. It is important to note that the Financial

Inclusion Task Force of the United Kingdom, one of the pioneers to talk of

financial inclusion, has identified 'access to free face-to-face money

advice' as an important component of financial inclusion, apart from

'access to banking' and 'access to affordable credit'. People need

information and advice when they either save their money or get into debt.

Such information and guidance can best be delivered by appropriate

mechanisms and if such effective mechanisms are put in place through the

banks, they in turn would reinforce the demand for financial services.

Another impediment is the difficulty or the lack of ease of addressing

issues that affect a common man. Despite concerted efforts, the current

state of transparency coupled with the difficulty of consumers in

identifying and understanding fine print information leads to an

information asymmetry between the financial intermediary and the

customer. It is important to understand that the lack of such awareness initself amounts to risk; and the challenge is to make customers aware of the

various risk. In terms of promoting financial inclusion, much of the work is

simply in providing easily understood information in a safe and engaging

environment.

Scope for financial education

in IndiaReserve Bank of India 33


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CDs. Banks can provide funds for setting-up such kiosks and meeting the

running costs or the cost can be shared among banks, and the other

organizations involved in the process.

Some non-banking initiatives are also being experimented in various parts

of the country. In this context, the project on financial counselling service

for poor self-employed women in India started by SEWA is well known.Project tomorrow, as it is called, was started in 2001 with a purpose to

develop and test a financial counselling curriculum to help participants

manage money productively, plan ways to increase assets, address life

cycle events, and manage risks. Through this project, SEWA has set up a

training unit and training delivery system and is developing tools and

procedures to monitor the counselling work. The project began with

market research to assess the needs and demand among SEWA clients for

financial education, followed by a 'training of trainers' course. SEWA isnow providing financial counselling to its clients through a weekly course.

The initial experience suggests that participants grasp the concepts

presented and welcome new perspectives stemming from such training.

While talking about financial education, it is important that the focus

also extends to the urban populace, including the literate masses,

which may not be having the financial acumen, technology

suaveness and may not be 'financially literate'. It is not that the urban

masses are well versed in the Internet Banking and other newer

methods of banking; there continues to remain a segment, which

either avoids using the services due to lack of confidence or remains

unaware of the options available. Financial education to such target

group would be mutually beneficial.

There is also a need for greater awareness of various products and

services offered by banks. Finally, the concept of financial education could ideally be stretched

to cover economic education as well. At a broader societal level,given the path of economic reforms India has embraced since the

early nineties, and the ensuing debates, it is imperative that the

society and general populace be objectively informed about the

fundamental economic issues and the rationale for, at-times difficult,

choices to be made in this regard. This could go a long way in

creating an informed and harmonious democracy.



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Initiatives taken by ReserveBank of India towards FinancialEducation

The RBI, on its part, wishes to advance the cause of financial education in

our country as part of an overall strategy. The concerted efforts areunderway to expand the reach of formal finance in view of recent emphasis

on financial inclusion. This needs to be buttressed with financial education

to generate greater customer awareness and understanding of financial

products and services. Concurrently, a process of credit counselling is

being encouraged to help all borrowers, but particularly those in distress to

overcome current financial problems and gain access to the structured

financial system. The Banking Codes and Standards Board of India

(BCSBI) has also been instituted which is expected to ensure that thebanks formulate and adhere to their own comprehensive code of conduct

for minimum standards of banking services, which individual customers

can legitimately expect. And finally, a Banking Ombudsman Scheme has

been instituted for redressal of grievances against deficient banking

services, covering all the States and Union Territories. The RBI has also

been exploring the possibility of instituting a Depositor Protection Fund

(DPF). The Fund can be utilised towards generating greater awareness for

the common man on issues relating to financial education and counselling.This could be complemented with providing greater role to our Regional

Offices to promote financial education in their respective jurisdictions.

Project Financial Literacy

In India, the need for financial education is even greater considering the

low levels of literacy and the large section of the population, which is still

out of the formal financial set-up. Towards this end, the Reserve Bank ofIndia (RBI), with the objective of disseminating information on the Central

Bank and general banking concepts to various target groups including

school and college students, has undertaken an initiative titled 'Project

Financial Literacy.' The project also aims to educate women, rural and

urban poor, defence personnel and senior citizens on general banking

concepts. Recently, a pilot programme has been launched on financial

literacy in Karnataka. The programme, launched by RBI in collaboration

with the state government, will involve introduction of financial andrelated material in the curriculum of schools and colleges. Significant steps



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Reserve Bank of India has made a link in its website named Common

man. This site is available in 13 regional languages including Hindi and

English.

It provides knowledge about The role and functions of RBI

How is Indias central bank relevant to the people

RBI regulations Solve the FAQ of peoples Provides information how to complain against commercial banks as

well as central bank.

It also provides information on money, banking and finance

RBI young scholarshipaward schemeTo encourage learning about the Reserve Bank of India (RBI) among the

youth of the country, the RBI conducts a major awareness and sensitization

exercise on the role of the Reserve Bank and the banking system across the

country. This exercise, the RBI Young Scholars Award Scheme, exposes

youngsters to an actual banking and financial environment and inculcates asense of pride in the selected ones of having had the opportunity to



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associate them with a prestigious organisation, the central bank of the

country.

Currency note posters

The Reserve Bank of India provides currencynote posters which name is

Know Your Bank Note. In this link RBI provides the security features of

Indian currency Notes. These are from RS.10 to Rs.1000 in all regionallanguage.



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The Working Group (Chairman: Prof.S.S.Johl) constituted by the Reserve

Bank to suggest measures for assisting distressed farmers had

recommended that financial and livelihood counselling are important for

increasing the viability of credit. Further, the Working Group constituted

to examine procedures and processes for agricultural loans (Chairman:

Shri C.P.Swarnkar) had also recommended that banks should actively

consider opening of counselling centres, either individually or with pooledresources, for credit and technical counselling with a view to giving special

thrust in the relatively under-developed regions. In the light of the

recommendations of these two groups, the convenor banks of the State /

Union Territory Level Bankers' Committees were advised in May 2007 to

set up, on a pilot basis, a financial literacy-cum-counselling centre in any

one district in the State/ Union Territory, coming under their jurisdiction.

Further, on the basis of the experience gained, the Lead Banks concerned

were advised to set up such centres in other districts.To conclude, economic and financial sector reforms have placed higher

disposable incomes with the public. Availability of a variety of new

financial products on both, credit and investment sides, which are provided

by a host of financial intermediaries has necessitated that the investing

public understands the nuances of each product and product supplier, and

takes an informed decision about where he should invest. At the same

time, those who are not part of the formal financial system need to be

educated about banking and why they should have a relationship with banks. Financial education is considered an important element for

promoting financial inclusion and ultimately financial stability. Financial

education would benefit the financially-excluded by enabling them to

understand the benefits and the ways to join the formal financial system. It

could also benefit the financially-included by helping them make informed

choices about the products and services available in the market to their best

advantage.

Objective of Counselling:

i. To provide financial counselling services through face-to-face

interaction as well as through other available media like e-mail, fax,

mobile, etc. as per convenience of the interested persons, including

education on responsible borrowing, proactive and early savings, and

offering debt counselling to individuals who are indebted to formal

and/or informal financial sectors;



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ii. To educate the people in rural and urban areas with regard to various

financial products and services available from the formal financial

sector ;

iii. To make the people aware of the advantages of being connected with

the formal financial sector ;

iv. To formulate debt restructuring plans for borrowers in distress andrecommend the same to formal financial institutions, including

cooperatives, for consideration ;

v. To take up any such activity that promotes financial literacy,

awareness of the banking services, financial planning and

amelioration of debt-related distress of an individual;

Initiatives taken byregional RBI offices in IndiHyderabad regional office

Hyderabad office of the Reserve Bank has formulated a multi-modal

(informative display through posters, brochures, multi-media

presentations, video films, demonstrations, computer games), multi-lingual

(English, Hindi, Telugu and Urdu) and customised interactive strategies

(like stalls in exhibitions, visits to schools, colleges, villages, meeting with

bankers, traders, farmers, SHGs, tour of the Reserve Bank) for spreading

financial literacy among the common persons in general and school

children, college students, farmers, women and villagers in particular.

New Delhi Regional OfficeNew Delhi Office brought out a comic book on basic banking, titled

'Raju and the Money Tree'. A Core Committee on Financial Education,

comprising of officers from RBI, New Delhi conceived and scripted the

story of the comic book as also handled the artwork. The comic book was

brought out in English and Hindi. Copies of the comic book were handed

over to the officials of Government of Himachal Pradesh at Simla on July

1, 2007 coinciding with the inauguration of the sub office. The comic book

was also brought out in Braille for the benefit of visually impaired persons.

The services of National Association for the Blind, New Delhi were taken

for adapting the story from the comic book.

Chennai Regional OfficeChennai Office has brought out two comic books titled 'Currency Matters'

and 'Bank Matters' in English and Hindi as part of the Bank's financial



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education efforts. The stories for the comic books were prepared in-house

by a team of officers, drawn from various departments of the local office

and the artwork was out sourced. Copies of the comic books were handed

over to the officials of Government of Himachal Pradesh during the

inauguration of the Simla sub-office on July 1, 2007. The books are being

translated into Tamil.

Bangalore Regional OfficeBangalore Office has released, under its FIN-LIT project, a series of four

comic books, in English and Kannada, dealing with (i) introduction to

basic banking, (ii) deposits, (iii) SHGs loans especially agricultural loans

and other livelihood loans like Govt. Sponsored schemes, etc. and (iv)

other lifestyle enhancing loans like housing loans, vehicle loans, etc. and

other products like ATM cards debit, credit cards. A short film, based on

the frames of the books, with voice over in Kannada has also been

released. As an initiative in reaching out to a larger audience, the Officehad put up a stall in the Mysore Dasara Exhibition where this film was

screened along with other information of relevance to the common man.

The whole project of writing the stories and doing the illustrations was

undertaken in house.

Initiatives taken byReserve Bank India,Bhubaneswar towardspromoting financialeducation and literacyFinancial Education- Credit Counselling:- Persuaded UCOBank to open a credit counselling centre at Balasore. The Centre plans to

take up a Literacy drive in association with the local chapter of the

Chartered Accountants on Fundamentals of Book Keeping to SHG groups.

Financial Literacy:- The publication Bank Matters brought out byChennai Office has been translated into Oriya language and Santhali

language. The books were released by Honble Union Minister of State

(Shri Pavan Kumar Bansal) on November 14, 2007 at the 111th SLBC

meeting at Bhubaneswar.



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Publicity through TV / Radio:- As a supplement to the field levelefforts, RBI, BBSR have also embarked on a promotional biz. The SLBC

contracted 15 minutes space per week for six months in DD and AIR

respectively in which a programme SANCHAYA on issues relating to

Financial Inclusion (generic and not bank specific) were discussed. The

programme highlights financial literacy and addresses queries from

viewers. The broadcast covers 11 districts of Orissa. The expenses on thisad biz are on cost sharing basis by SLBC members.

Social Campaign- Putting into practice what RBIpreach:- RBI have sold the idea to the Rotary Club (Bhubaneswar) toinvolve themselves in financial inclusion exercise in a slum in

Bhubaneswar and other cities. The Rotary Club received the idea warmly

and in association with Vijaya Bank introduced financial inclusion

programme in the identified slum in which 1700 slum dwellers were

brought under the fold of banking. Most of them are migrant labourers

from Andhra Pradesh and RDs address to them in Telugu (lasting for

about 15 minutes) spurred them to open the accounts.

100% Financial Inclusion :- One of the objectives of Financialeducation is to help inclusive growth. Ganjam District (population 31.60

lakh) has been declared as 100% financially included. Till now in Orissa27 districts are declared 100% financially included Out of 30 districts. The

rest three districts are Jharsuguda, Malkanagiri & Nabarangapur.

Mission Approach:- The Anganwadi workers of State Governmentact as business facilitators and are being paid Rs 10/- per account opened

by the branch concerned. The expenditure on photographs of the

financially excluded persons approaching the bank for opening the

accounts is borne by the branch concerned. Our officers are frequentlyinteracting with the business facilitators and coordinators to educate them

about the mission.

Educating School children and rural population:- TheState Level Essay Competition for school children on financial inclusion

organised by RBI was received warmly.



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Financial LiteracyProgrammes held by OrissaRegional Office5 19.06.09 UCO Bank Bhograi

(Chandaneswar-

Gazipur)

UCO BANK SHGGroups and

Farmer club

members

6

14.07.09 St Xaviers High

School ,BBSR

Students of

IX & X

standard

721.07.09 BJB English Medium

School,

Bhubaneswar

Students of

IX & X

standard

8

27.07.09 DAV School,

Pokhariput,

Bhubaneswar

Students of IX

& X

Standard9

01.08.09 Kalinga Institute of

Social Sciences

Students of IX

& X standard

10

03.08.09 Marsaghai High

School,Kendrapara

Students of IX

& X standard

11

06.08.09 Bipin Bihari School,Bhubaneswar for the

deaf and dumb

Deaf anddump

students of

VIII, IX &

X standard

12

07.08.09 Bhima Bhoi School

for the Visually

Challenged,Bhubaneswar

Visually

challenged

students ofVIII, IX &


s.lno

date place Organisationinvolved

Coveredpeople

1

7.2.200

9

Maitapur G.P in

Simulia Block of

Balasore District

Meeting

with Farmers

club viz.

Palli Pragati

KrushakMancha,

2

23.05.0

9

Padmasekharpur,

Bhubaneswar

UCO BANK

Educate the

villagers of the

advantages of

opening bank

account

327.05.0

9

Indian Bank,

Microstate branch,

Cuttack Road

INDIAN

BANK

SHG Groups

4

15.06.0

9

SBI, Sakhigopal,

Puri

STATE

BANK OF

INDIA

SHG Group

members

and NGOs


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X standard

13 14.08.09

Zilla School Puri

Students of IX

& X standard

14 18.08.09

Palli Unnayana SevaSamiti Naharkanta,

Bhubaneswar

XaviersInstitute of

Management,

Bhubaneswar

Students of IX

& X standard

15

Nov 2nd

to 8th

2009

Baliyatra Exhibition,

Cuttack

General public

16Nov 21st

to 24th

2009

Confederation of

Indian Industry-

exhibition

General public

Initiatives taken by OrissaState Govt. towardsFinancial Literacy



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Orissa state govt has supplied some financial education books to the public

especially to the women of the state who dont know about the basic

financial aid or services.



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DATA ANALYSIS ANDINTERPRETATION

While undertaking this project, there is a need to conduct a survey work.The work is confined to the various areas of Bhubaneswar. Questionnaire is

used to record the data.

Analysis

1- Meaning of BANK :



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INTERPRETATION

In the above chart, it is depicted that 28% of the people says that bank is an

institution which accept only deposits. 18% of the people say that bank is an

institution which provides loans and 54% says that bank is performing both

the activities.

2-Types of banks:



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Interpretation

From the above chart it is shown that 30% of the people known about

different types of bank in India. 70% of the people unable to answer to

about the types of bank in India

3- Formalities required to open a bank

account:



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INTERPRETATIONFrom the above chart it is shown that 42% of the people know that the

formalities required to open a bank account.58% of the people are

ignorant about that.

4- Different types of account:



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INTERPRETATION

From the above chart we are able to know that, 32% of the people

know about the various types of bank accounts and 68% of the people

were unable to answer.

5- Different kinds of services provided:



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Interpretation

35% of the respondents are known about the various kinds of servicesprovided by the bank. 65% of the respondents are unknown about the

various services provided by the bank.

6- Account that facilitated various payments(electricity bills, phone bills and school fees etc.)



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Interpretation

From the above chart, it is depicted that only28% of the respondents

are knowing which account provide payment facility. Others i.e. 72%

of the respondent are unknown about this.

7- Banking Ombudsman



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interpretation

From the above chart, it is clear that only 9% respondents are known

about the Banking Ombudsman. 91% respondents are unknown about this.

8 Account that is accompanied with

deposit insurance



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Interpretation

From the above chart it is depicted that, 11% of the respondents are known

that bank account is accompanied with deposit insurance.89% of therespondents are unknown about this.

9- Sole right of issuing the currency note:



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Interpretation

From the above chart, we can see that 42% of the respondents are aware

about the note issuing authority, still 58% respondents are ignore about

this.

10- Awareness regarding FORGED NOTE:



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Interpretation

From the above chart, it is depicted that 37% of the respondents are aware

about the forged note. Still 63% of the respondents are unknown about the

security features of the currency note.

Financial awareness among varioustarget groups



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Interpretation

A Women

B School and college going children

C Urban poor

D Defence Personnel

E Senior citizen

From the above chart we can see that:

Only 28% women are knowing about the various banks, banking

services and their uses

12% of the school and college going students know about the Central

bank and other banking habits.

20% urban poor are aware about it. 21% senior citizens are aware about it.



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Major findings from thesurvey From the survey, I came to know, the age-old concept of Bank still

holds good now. Though banks are coming up with many new

technologies and opened service in various fronts, still people are not

very much aware of it. For many people, bank is still keeping money

and lending institution. From the survey, it was evident that-not many

people know about investments. For them investment is all about

keeping money in savings account. They were completely except a few

are ignorant about mutual fund and other banking products.

A huge mass of people of people are unaware of the different types of

bank exist in India. The figure above shows the unawareness of people

among the existence of various banks in India.

A decent margin of respondents knows about the formalities i.e. the

documents required in opening an account. Later it was realized that,



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all of them have either have one or multiple accounts. Bank should

educate its customers regarding the documents required to open an

account. It might reduce the work pressure the bank employees as well

as the educated customers may in turn help other customers.

Basically, people were aware of savings account. Though many people

had accounts in various banks but they were unable to tell the kind of

account, they are operating. Maximum respondents were just aware of

savings account. But many of them lack awareness regarding Current

account, cash credit account, OD etc.

Currently, it is seen that banks are coming up with many new kind ofservices thanks to new technologies. E.g.-Mobile Banking. But the

problem lays when customer are completely ignorant of how to use

those technologies. They are not properly educated to use these

technologies. Some customers, who know about these technologies,

feel scared to use these technologies thanks to many fraudulent

activities happening in various technologies front.

Per example: Losing money in online transaction.

As discussed before, many people are not aware of these technologies.

Banks through various awareness program should educate customers.

Secondly, many people do not feel secure in these kind of transactions

as they are scared of loosing their money. Banks should create faith

among the customers for using these kind of technologies as not only it

will save time for both customers and bank but also will save their

money. A few percentage of respondents are aware about the Banking

Ombudsman. It is generally created to solve the grievances of the

customers. The major concern of this is to protect the customer.

From the survey, I found insurance as the most mislead product in the

industry. When you use the term insurance, many customers do not

look beyond LIC. Banks are also not doing enough to educate



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customers regarding insurance and how it will help them to create

wealth and secure the financial independence in the event of the

customers death. Bank assurance should be provided in all banks.

Still peoples are not fully aware about the central bank of India.

Unawareness among the people about the forged notes.

SuggestionsCreate Awareness & Financial Literacy

Governments and all concerned stakeholders should promote unbiased,

fair and coordinated financial education.

Financial education should start at school, for people to be educated as

early as possible.

Financial education should be part of the good governance of financial

institutions, whose accountability and responsibility should be

encouraged. Financial education should be clearly distinguished from commercial

advice; codes of conduct for the staff of financial institutions should be

developed.

Financial institutions should be encouraged to check that clients read

and understand information, especially when related to long-term

commitments or financial services with potentially significant financial

consequences: small print and abstruse documentation should be

discouraged. Financial education programmes should focus particularly on

important life-planning aspects, such as basic savings, debt, insurance

or pensions.

Programmes should be oriented towards financial capacity building,

where appropriate targeted on specific groups and made as

personalised as possible.

Future retirees should be made aware of the need to assess the financial

adequacy of their current public and private pensions schemes.



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National campaigns, specific Web sites, free information services and

warning systems on high-risk issues for financial consumers (such as

fraud) should be promoted.

Intensive awareness, education and promotion drive to create an in-

depth impact on the masses.

Government should promote introduction of basic banking relevance,

services, merits as a topic in secondary and higher secondary classes inall education institutions.

Government sponsored publicity campaigns through all Medias

radio; television; newspapers e-choupal; village panchayat; movies;

local stage shows etc.

Banks should design and organize aggressive education cum

promotion campaigns in unbanked parts of urban, semi urban and

rural areas to enhance financial literacy and awareness, as well as to

remove the doubts and apprehensions that the masses have towards thebanking sector.

Banks should involve the knowledgeable and well-informed local

inhabitants in such activities. This will help the banks to consolidate

and ensure, prompt and extensive response from populace.

Banks should gather support from the NGOs, retired bank personnels,

and academic institutions, to reach the desired numbers within a

limited span of time. Once the fallacy is removed from the minds of

the general public, they automatically will join the mainstream. The all-round awareness and education simulation will drive them to open

savings and current accounts. This will mark the beginning of basic

banking in true sense.

There is an utmost need to improve BC/BF model.



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ConclusionFinancial literacy is an understanding of personal finance and the ability

to use that understanding to benefit your economic condition. Those withfinancial literacy deficiencies often find it hard to manage money and

save for long-term personal goals, such as buying a house or retiring.

Financial literacy can be promoted by bringing in wider section of public

within the institutional literacy framework. Such institutional initiatives

would largely focus on improving literacy standards. Also, all financial

service providers have a moral responsibility to bring in a fair degree of

transparency and fairness, more so those engaged in selling financialproducts and financial counselling and the ethical grid within which they

are supposed to work. This initiative is no less challenging than

propagating financial literacy to the members of the public.

There is a need for banks and other agencies striving to extend financial

education to the masses to appreciate that financial inclusion is a

continuous process. Efforts to extend literacy to make the common man

enabled by being aware of the evolving functional, legal and technical

issues cannot be a one-time effort.

A common effort of the educational programmes typically focuses on the

'supply' side that stresses on attracting customers in the financial fold.

However, what is needed is to have is an "auto pilot" concept, where the

prospective customer is empowered to make / demand the desired

services. This could create a qualitative 'demand' situation of the financial

services.

The objective of financial education is also customer protection. It helps

customers to better understand and manage financial risk and deal with

complexities of the market place and take advantage of increased

competition and choice in the financial sector. The RBI, on its part,

intends to advance the cause of financial education in the country as part

of an overall strategy. Currently, a process of credit counselling is being

encouraged to help all borrowers, particularly those in distress, to

overcome current financial problems and gain access to the structuredfinancial system.



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However, in the ultimate analysis financial education is only one pillar of

an adequate financial policy to improve financial literacy and expand

access to financial services. It can complement, but not replace other

pillars such as greater transparency, policies on consumer protection and

regulation of financial institutions.

This project has argued that financial literacy is important at many levels.It is an essential element in enabling people to manage their financial

affairs and can make an important contribution to the soundness and

efficiency of the financial system, and to the performance of the

economy.

Improved financial literacy can benefit individuals and families by giving

them more control over their money and helping them make better

financial decisions. Good financial literacy skills will build the capacity

of Indians to better understand and manage financial risk, and take

advantage of increased competition and choice in Indias finance sector.

Financial literacy is in the interest of India as a whole, and the creation of

a financially healthy India is the responsibility of all government, the

private sector and community-based organisations. It is too large a task

for one group of stakeholders to achieve on their own.

The final result is not to create financial experts; it is more important toequip individuals with sufficient knowledge to make sense of financial

activities, seek out appropriate information, feel able to ask relevant

questions, and be able to understand and interpret the information that

they subsequently acquire.



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Bibliography Improving financial literacy

OECD Publication

2005

Speeding of financial inclusion

By Sameer kocher 1st edition



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Financial Services

By Nalini Prava Tripathy

2008

Financial Services

M.Y.Khan

2004

ReferenceThe Role of Financial Education: The Indian Case-Inaugural Address

by Dr. Y. V. Reddy, Governor, Reserve Bank of India at the

International Conference on Financial Education organised byOECD at New Delhi on September 21, 2006.

Financial Education: Worthy & Worthwhile speech by Dr. Duvvuri

Subbaro, Governor, Reserve Bank of India, at the RBI-OECD

workshop at Bangalore on March 22, 2010.

Special address by Ms Shyamala Gopinath, Deputy Governor of the

Reserve Bank of India, at BANCON 2006, Hyderabad, 4November2006.



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Financial Inclusion through financial Literacy & Credit

counselling( Address by Dr. K.C. Chakrabarty, Deputy Governor,

Reserve Bank of India, at the launch of Federal Ashwas trust on

November 30, 2009 in Kochi, Kerala.

Financial Literacy: Concept & its importance in India by Mr. BhusanBhatia, Sr Faculty, Punjab National Bank, Regional Staff College,

Panchakula

Importance of Financial Literacy in the Global Economy Keynote

Address by The Hon. Donald J. Johnston, Secretary-General of the

OECD to the Financial Education Summit, Kuala Lumpur, 12

December 2005

APPENDIXQuestionnaire

1 - What is a bank?

(A) An institution which accept deposits

(B) An institution which provide loans

(C) Both

2 Do you know what are the different types of banks inIndia ?

(A) Yes (B) No



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3 Do you know the formalities required to open a bankaccount ?

(A) Yes (B) No

4 Do you know what are the different types of account in

a bank ?

(A) Yes (B) No

5 Do you know what are the different types of servicesprovided by the bank ?

(A) Yes (B) No

6 - Which account allows the facilities like payment ofelectricity bill, phone bills and school fees ?

(A) Saving a/c (B) Current a/c (c) fixed deposits

7- Do know what is Banking Ombudsman?

(A)Yes (B) NO

8-Do you know the bank account is accompanied withdeposit insurance?

(A) Yes (B)

9 Do you know who has the sole right of issuing theCurrency note ?

(A) Yes (B)

10- Can you identify a Forged note ?

(A)Yes (B)No

This is used to collect and record the data collected

from 5o sample.



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Padmini -Rbi - Copy

Documents

Transcript of Padmini -Rbi - Copy