A Study on Financial Inclusion in India and Its Relation with Financial Literacy

Abstract

Finance has become a crucial part of our economy for development of the society. For this purpose, a solid economic system is required not only in developing and under-developed countries but also for developing countries for maintaining growth. Through financial inclusion we will achieve equitable growth of our country. Financial inclusion means providing appropriate products and services to weaker sections at a reasonable cost. Now day’s financial institutions provide complex sort of products. So it's difficult for the commoner to form choice among them. Therefore, literacy about financial products is required to form sound decisions. Financial Literacy isn't nearly markets and investing, but also savings, budgeting, financial planning, basics of banking and most significantly, about being "Financially Smart". Financial Literacy is considered important factor for promoting financial inclusion. Financial literacy is about enabling the commoner to know the varied needs and benefits of varied financial products and services provided by institutional players. During this paper, review of literature of monetary inclusion and financial literacy is provided. Various determinants of monetary literacy and its relationship with financial inclusion have also been reviewed and studied.