RBI

RBI releases the National Strategy for Financial Education: 2020-2025

RBI releases the National Strategy for Financial Education: 2020-2025

Financial education is defined as the possession of the set of skills and knowledge that allows an individual to make informed and effective decisions with all of their financial resources.

RBI National Strategy for Financial Education: 2020-2025

Objectives

To achieve the vision of creating a financially aware and empowered India, the following Strategic Objectives have been laid down:

i. Inculcate financial literacy concepts among the various sections of the population through financial education to make it an important life skill

ii. Encourage active savings behaviour

iii. Encourage participation in financial markets to meet financial goals and objectives

iv.Develop credit discipline and encourage availing credit from formal financial institutions as per requirement

v. Improve usage of digital financial services in a safe and secure manner

vi. Manage risk at various life stages through relevant and suitable insurance coverv

ii. Plan for old age and retirement through coverage of suitable pension products.

viii. Knowledge about rights, duties and avenues for grievance redressal

ix.Improve research and evaluation methods to assess progress in financial education

5C Approach

In order to achieve the Strategic Objectives laid down, the document recommends adoption of a ‘5 C’ approach for dissemination of financial education through emphasis on development of relevant Content (including Curriculum in schools, colleges and training establishments), developing Capacity among the intermediaries involved in providing financial services, leveraging on the positive effect of Community led model for financial literacy through appropriate Communication Strategy, and lastly, enhancing Collaboration among various stakeholders.

Recommendations

The recommendations laid down in the Strategy under each of the ‘5 Cs’are as under:

Content Financial Literacy content for school children (including curriculum and co-scholastic), teachers, young adults, women, new entrants at workplace/ entrepreneurs (MSMEs), senior citizens, persons with disabilities, illiterate people,etc*
Capacity

Develop the capacity of various intermediaries who can be involved in providing financial literacy.

Develop a‘Code of Conduct’ for financial education providers.

Community Evolve community led approaches for disseminating financial literacy in a sustainable manner
Communication

Use technology, mass media channels and innovative ways of communication for dissemination of financial education messages.

Identify a specific period in the year to disseminate financial literacy messages on a large/ focused scale.

Leverage on Public Places with greater visibility (e.g. Bus Stands, Railway Stations, etc.) for meaningful dissemination of financial literacy messages.

Collaboration

Preparation of an Information Dashboard

Integrate financial education content in school curriculum, various Professional and Vocational courses (undertaken by Ministry of Skill Development and Entrepreneurship (MSD&E) through their Sector Skilling Missions and the likesof B.Ed./M.Ed. programmes.

Integrate financial education dissemination as part of various on-going programmes.

Streamline efforts of other stakeholders for financial literacy

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