What is financial literacy? In simple terms it is the literacy about the financial instruments. But in broader terms it is not like that. Financial Literacy leads to economic independence. Economic independence leads to a better society. Everyone will be able to contribute his share to the country, when high level financial literacy is achieved. Everyone can not become economists. But in day today life we are dealing with more and more terms and jargon s related to economics (or should I say financial terms).
Recently finance minister Pranab Mukherjee urged that in India there is an urgent need to promote financial literacy programs. He also made it clear that urban population in India is some what exposed to financial literacy but the rural people don’t have much idea about it. The banking system in India is not well developed in rural India where majority of the citizens reside.
After all what is financial literacy and how it can be promoted. In Karnataka Reserve bank of India in association with organization for economic cooperation and development (OECD) rigorously conducted financial literacy programs. Actually the program is conducted in schools. It is a good move and should be imitated. Of the 117 Crore population in India only less than 10 percent is investing in any of the instruments. Only because of this they are not getting the benefits of India’s economic growth. Less than 2 percent of Indian’s are investing in share market instruments (recent report shows that the figure is only 85 lakh).
Financial literacy programs should be started from schools itself. Now a days stock brokers and stock exchanges are conducting financial literacy programs all over the country. Since it aims at promoting the business lacks something. Government should take over this and start aggressive promotion of financial literacy programs. As I said earlier it should be started from schools.  Some certificates should be given to qualified students. This move will be beneficial for all the individuals. They can persue their studies in it and if not they can start investing at an younger age. Investment, at all times, is a good habit. RBI, SEBI, NSE and BSE are the major bodies in the country which should take the responsibility of promoting financial literacy. When more and more are aware of the investment instruments it will be a boon for the economy in particular.