Financial literacy remains a critical issue in India’s Tier-2 and Tier-3 cities, posing a significant hurdle to economic empowerment. A recent SEBI study shows that just 27 per cent of India’s population is considered financially literate. This sobering statistic highlights a clear need for focused efforts to enhance financial education, particularly as India prepares its 2024 budget.
The upcoming budget presents a golden opportunity to address the imbalance between major metros and smaller cities regarding financial knowledge and access. We must understand that true financial inclusion goes beyond basic banking access. It requires a comprehensive approach to empower individuals with the skills to budget, save, and navigate the formal financial system.
Current challenges One of the biggest reasons people in Tier-2 and Tier-3 cities face significant hurdles in achieving financial literacy is limited access to formal banking institutions, which forces many to rely on riskier informal lending channels. This, coupled with a general lack of awareness about financial products, creates vulnerability, making it difficult for families to plan for long-term goals or weather financial emergencies. How we can leverage Budget 2024 The 2024 budget can make a lasting impact by allocating funds, specifically for financial literacy initiatives in smaller cities.
One key area for investment is enhancing the role of Business Correspondents (BCs) as financial educators. With proper training .