Chapter 3: Review of Literature

Financial Inclusion And Women Empowerment: A Gender Perspective by Bincy George

and K.T.Thomachan in International Journal of Research -GRANTHAALAYAH , Vol.6
(Iss.5): May 2018.
This study mostly focuses on those women who are doing some entrepreneurial
activities by taking up loans. We know financial inclusion is access to financial services like
bank account, savings, credit, insurance etc. So, we can see that all the respondents have
access to the financial services. When women have some saving they will be financially
independent. They can take their own decisions. In the case of women who have taken up
their own business are successful and are financially independent. These all leads to
empowerment of women especially economic empowerment. Thus, proving the fact that
financial inclusion leads to women empowerment. Financial inclusion is the expanding
outreach of banking or financial services at an affordable cost. This also indicates whether
access to financial services helps them to make their own decisions and whether they are
financially independent. The various financial services include access to saving, credit,
insurance, bank account etc. The access to financial services helps them in their social and
economic development. Saving helps women to plan and invest in small ventures which they
can run successfully with the help of loan. Insurance enables women to overcome risk to
health, old age, death etc.

Financial Literacy and Financial Inclusion in India Revised Paper, by Sunil B. Kapadia
and Venu Madha in International Journal of Pure and Applied Mathematics, Volume 118
(January-2018).
This report states that, earlier financial inclusion ‘would likely have referred to an
institutional issue such as portfolio growth, Today the term is more centred on clients,
encompassing both access (the institutional responsibility) and use -clients‘ ability to choose
and use the services available to them. International Journal of Pure and Applied Mathematics
Special Issue 1146 It implies financial capability. Financial education is essential to both of
these overlapping concepts. Yet, two decades ago, few in the developing world had ever heard
of financial education. Today, it is coming to your TV; your bank will send text messages
reminding you to save; local newspapers run weekly financial advice columns; governments
are mandating that financial institutions publish transparent product prices. The return of the
consumer that these developments indicate is welcome. A more definite interpretation of the
factors affecting access will have to await better data on access and use at both the micro and
the macro level. This will require actions by national and international agencies to develop
more comparable data on use and access barriers. Data on use will have to come from
different sources: Providers of financial services (directly and from national statistics); Users
of financial services (from surveys); and Experts (to identify constraints). However, there
exist challenges in terms of further growth of various markets with greater depth and width
to reach across all segments of investors/ participants with broad spectrum of choices. Below
mentioned are few areas that need development: Spreading of awareness, literacy and
education about financial markets, different assets and products so as to empower common
man/investor to participate in the market with required knowledge, thus gain ultimately.
Administrative reforms to help facilitate entry into market for on boarding of first time
investor with standard KYC norms in a transparent, user-friendly environment. The need for
a well-developed bond market with a sizeable corporate debt segment which will offer an
alternative to banks for raising capital by corporates, leading to an improvement in efficiency
of capital market. Engaging with different stakeholders of society through various platforms
which will include: Collaboration with educational institutions of all kinds to carry out further
research and development for enhancing market role with greater participation of
stakeholders; Organising research conferences and conducting seminars thereby inviting
more & more new participants fostering deliberation and feedback for overall improvement;
Organisation of award ceremony for sharing of best practices.

Financial Literacy among Women – Indian Scenario by Chetna Singh and Raj Kumar
from Institute of Management Studies, Banaras Hindu University, India and in Universal
Journal of Accounting and Finance 5(2): 46-53, 2017.
This report showed financial literacy among women is very low. It enables people
to understand what is needed to achieve a lifestyle that is financially balanced, sustainable,
ethical and responsible. It is directly related to the wellbeing of an individual and society as
a whole. Financial literacy would help the women in making better financial decisions and
helps in the utilization of financial products and services In our country, where poverty and
unemployment are the major problems, it is very crucial to financially literate the women to
fuel the engine of growth by providing opportunities to women to contribute to economic
growth. While women in developed countries proved to be better financial planners relatively,
it is the women of emerging economies who have to become literate when it comes to money
management issues. Though various initiatives were taken by different organisations to boost
the financial literacy but still there is a need of more awareness programs which may include
workshops, seminars, and financial management courses at different levels to get more
financial knowledge regarding the banking services and their benefits one can attend.

Financial Literacy Among Women in India: A Review by Dr.Garima Baluja in Pacific

Business Review International Volume 9 Issue 4, Oct 2016.
In this report it was found out that the Government of India is putting lot of efforts
for ensuring financial inclusion in the country. Financial inclusion is the road that India needs
to travel for becoming a global player. Financial literacy means spreading the financial
education among the people across the country. While the need for financial literacy may be
largely acknowledged, the importance of gender dimension remains a subject for debate.
Voluminous studies have documented the existence of gender differences in the financial
literacy across the world but the studies on financial literacy among the women in India are
quite scarce. This paper analyses the issue of financial literacy among women in India. It has
been observed that there are several problems faced by Indian women due to which they lack
in financial literacy such as cultural barriers, physical barriers, psychological, and financial
barriers etc. However over a period of time women are realizing the importance of savings
and investments in improving their individual economic status as well as their family a whole.
Hence more financial literacy programs and institutions should be established in order to
create more awareness on financial terms to women. This will make women the part of
financial inclusion and will facilitate the growth of nation as a whole.
Improving Financial Literacy among Women: The Role of Universities by Monika
Dwivedi, Prof. Harsh Purohit, Divya Mehta in Economic Challenger, October-December
2015 issue.
This report state that the financial literacy and inclusion in India report by NCFE
shows that there is strong need of financial literacy awareness all across the India, in which
rural area individuals have low level of literacy as well as inclusion which shows that there is
lack of awareness and low access to financial services. Similarly the situation of women is
very concerning as they have scored very less percentage in financial literacy as well as in
inclusion. In occupation wise analysis government employees have scored well in all the
aspects but the situation is worst in the case of agricultural labourer, scores are not even good
for housewife/homemaker that shows that women are not aware about their financial rights,
not financial services, they have to take part in their finances in the family. For boosting
financial literacy stakeholders are working towards it and now they have realized that
financial literacy can be done effectively by education to schools and education institutes, but
none of the stakeholders have a thought about the role universities can play in spreading
financial literacy.
Financial literacy is very important for women because of the special status they
are holding, before marriage they are dependent upon their parents for their financial need or
if working they depend upon their father, brother for all the financial decision and financial
transaction. After marriage they are dependent upon their husbands for all the financial need
even if they are working, they are not taking part in the financial decision in their family or
they consider this as whole sole responsibility of the earning member or their husbands. but
they don’t understand the importance of taking part in financial decision which is very
important by taking part in the financial decision with their family they can better plan for
their long term short term goals of financial life and also when they participate in it will boost
their confidence to handle their finances and when they are aware about the financial position
of their family they can better manage the finances and also can take better decision. As they
marry with the man who is usually elder while life span of women is more as compared to
men; financial planning become more important for them and most important is the retirement
planning. Women have to participate in the financial decision in the family and when they
participate in the decision they can better talk about their financial concern to their family
members. Both the couples have to participate in the financial decision as both of them have
to run their family in better manner.
Women also have risk of separation, widowhood and also the fact that they have
to take career break due to some circumstances in the family, yes it is true that their family
members are there to take care of them but financial independence and financial
understanding can result into better financial planning and better management of finances
which ultimately helps the family. Financial Literacy of women is inarguably a key
determinant of financial independence of women, women empowerment and prosperity of
the nation the women also have less occupation choices and in fact less time in the occupation
due to childbearing and restriction to them through various social norms. In case of urban
women banking facilities are very near to them but they are resistant to take part in these
services and consider this as men works, in case of rural women it is also a constraints because
rural areas lack the banking facility availability everywhere, sometimes women are not given
freedom to manage their finances. Role of universities is very important in boosting financial
literacy has not been recognized. Through universities, financial education and counselling
centres can be created which can help in providing the financial education, also peer to peer
programs can also be very effective mode of spreading the financial literacy, financial
professional can also deliver some programs on investor awareness and distance learning
program can also be launched in universities in financial literacy for boosting the financial
education. Apart from these interactive online programs, classroom based programs, game
based programs, and event based programs and individual counselling can results into better
financial literacy mode in universities. Research work on financial literacy, various
competitions and contests, awareness sessions and financial literacy task force can results into
boosting financial literacy. Universities can also work in building their own model of boosting
financial literacy as undertaken at the Bank of America.

Effectiveness of Financial Literacy Interventions in Improving Financial Literacy among

Rural Women in North India by Prof. Sobhesh Kumar Agarwalla Prof. Samir K. Barua
Prof. Joshy Jacob Prof. Jayanth R. Varma in journal of Indian Institute of Management ,
Ahmedabad October 2014.
According this report, Training is effective in improving financial literacy in the
long-term (eighteen months). However, the effectiveness varies across the three dimensions
of financial literacy. While the effectiveness is high for financial knowledge and financial
behaviour, it is only marginal for financial attitude.
• Training is effective in improving financial literacy in the short-term (one to three months).
The effective is the highest for financial knowledge and the least for financial attitude.
• There is a significant decline in financial knowledge and financial behaviour over time. In
case of financial attitude, the long term retention of learning is not statistically significant.
• The use of alternate techniques such as movies and games in the training programs does not
have a significant impact on financial literacy. This is because the positive influence of games
on financial behaviour and financial knowledge is accompanied with negative influence on
financial attitude.
• Joint training vis-a-vis individual training has a beneficial impact on financial attitude and
financial knowledge. It however has practically no impact on financial behaviour.
• In terms of percentage improvement in learning, training benefits women with low levels
of financial literacy far more than women with relatively higher levels of financial literacy
prior to imparting training. This is heartening since the key purpose of the training programs
is to benefit those with low initial levels of financial literacy.
• Women with low level of family income and low level of education benefit significantly
from the training imparted. The result confirms the value of training for the most
disadvantaged segment.
The study demonstrates that lectures with use of movies and games does not enhance the
efficacy of financial literacy training programs significantly. Therefore, a proper cost-benefit
analysis ought to be made if it is expensive to develop training material using thesetechniques.
The decline over time of financial literacy points to the need for refresher coursesto enhance
retention of learning in the long-term. Such courses ought to be based on sharing of
experiences of participants in applying some of the learning from the programs. Joint training
has a beneficial impact on two dimensions of financial literacy. An additional benefitof joint
training is likely to be the support that a woman may receive from her spouse in her efforts
to improve the family’s financial situation based on the learning from the programs .
Visa’s International Barometer of Women’s Financial Literacy by Visa Company April 17,
2013.
This report studies that, having enough money saved to cover emergencies is a key
indicator of an individual’s economic stability, regardless of their level of wealth. The level
of personal economic stability as measured by emergency reserves is very low around the
world, among both women and men. In fact, women in only one country. On the issue of
household budgets, data found that in only four countries do a majority of women follow a
budget most of the time. In the remaining 23 countries a majority of women either have no
budget, or think they are unable to budget for economic reasons. Survey data reveal that when
it comes to ensuring that their children are better prepared for the economic world they will
encounter women outperform men in many countries. But men are marginally more likely
than women to have two of the cornerstones of financial literacy—a budget that they routinely
follow and emergency reserves. In general, both men and women cited lack of funds as the
primary reason for not having a budget.36.8% women in India are financial literate. We were
ranked as 19 in 27 countries.37.9% women of India have and follow a household
budget.31.3% women in India less than 3 months’ worth of savings do you have set aside for
an emergency.25.8% women in India often do you talk to your children ages 5-17 about
money management issues.56.1% women say that teenagers and young adults in your country
understand money management basics and are adequately prepared to manage their own
money. 47.8% women think governments should require schools to teach financial literacy to
children, so that they can better understand money management issues.

Financial Literacy & Education: Present Scenario in India by Sumit kumar &Dr.Md.
Anees, in International Journal of Engineering and Management Research, Volume-3,
Issue-6, December-2013.
This report states that given the emphasis on education in India, it should be
possible to enhance the financial literacy among individuals. The financial literacy can be
easily improved through inclusion of relevant material on financial literacy in the general
education program of schools and colleges. The influences of sociological factors are
important in financial decision making process any intervention strategy must take into
account these sociological and behavioural aspects. The influence of the determinants
suggests that the strategy for improving financial wellbeing of individuals in India should be
focusing the young investors. Financial literacy and education is of particular relevance to
emerging economies. As these economies endeavour to improve the financial situation of
their citizens by achieving higher economic growth rates Financial Education offers many
employment opportunities to the people around the world. Enhancement of financial literacy
would help improve the financial well-being of their people even further through sound
financial decision making. The Financial education can help a person to understand the risk
and return related to the fund invested in different financial product. Financial education helps
in looking into a financial investment from various angles, and evaluating the various
alternatives.

Women and Financial Literacy: OECD/INFE Evidence, in Financial literacy and

education,June,2013.
Broadly speaking, women’s financial knowledge and confidence are typically
found to be the same as or lower than that of men. Although some studies of financial
capability/literacy show that women tend to do better at day-to-day household money
management, they still fare worse in other critical areas of planning, choosing products and
staying informed. These domains are fundamental not only to long-term wealth-building but
also for improving financial inclusion and entrepreneurial skills. However, apart from these
broad trends, we also note that the extent of the problem is not uniform: levels of financial
literacy for women, both absolute and relative, vary significantly across countries. Moreover,
it is difficult to identify the factors affecting gender differences in financial literacy and to pin
down causal links. Research on the likely determinants of these disparities highlights some
barriers that require further investigation, including fewer opportunities for experiential
learning through participation in household financial decision-making and working outside
the home, accessing credit or holding property as well as gender-specific differences in the
process of learning about financial literacy.
It should be noted that much of the previous literature relies on disparate datasets,
only a few of which have common measures; when drawing global inferences, therefore,
much caution has to be used. New research using internationally-comparable measures is
needed not just to explore new research questions but also to revisit and extend existing
analyses and conclusions with new data that also allow for international comparisons.
Moreover, there is scope for further data collection and research efforts addressing financial
skills and attitudes, rather than just financial knowledge, such as those carried out through the
OECD/INFE financial literacy measurement pilot and the OECD PISA financial literacy
assessment. Finally, given the gender differences, the question of how women can
individually and collectively gain economic empowerment is still very much an issue. Based
on both secondary research as well as a survey of INFE members, we found that the policy
response is relatively mixed. An important issue is that truly actionable evidence about the
nature of the gender gap, and the appropriate design, implementation and measurement of
suitable interventions is either non-existent, or as the results imply, may not be available. The
findings also suggest that few existing programmes have put in place strong evaluations
designed to yield results for future policymakers. On the basis of the research review, and on
the suggestions of the two co-chairs, a roadmap for the INFE subgroup work in 2012/2013
has been put forward based on 3 main interconnected work streams. The roadmap lays out
the key steps needed to help countries around the world improve financial literacy and status
of women: collection and analysis of systematic, internationally comparable data; identifying
and analyzing effective financial education programmes; and development of high-level
policy analysis. The outputs of the proposed roadmap will make significant strides toward the
ultimate goal of economic empowerment for women.

According to the annual MasterCard’s index for financial literacy Only Japan fared
worse with 57 points. In terms of overall financial literacy, India is at the bottom among 16
countries in the Asia-pacific region India is above with 59 index points from Japan, the index
is based on a survey conducted between April 2013 and May 2013 with 7,756 respondents
aged 18-64years.The survey polled consumers on three aspects — basic money management
(50% weight), financial planning (30% weight) and investment (20% weight) — to arrive at
the overall financial literacy index. On individual parameters, India scored 50 index points in
basic money management. The report states that for Indians, “the lack of ability to keep up
with bills, set money aside for big item purchases and to pay off credit cards fully could be
due to a lack of surplus cash, resulting from the fact that income levels are not high enough
to cover expenses”. Interestingly, the financial literacy scores for Indians aged 30 and above
were 59 compared with 61 for those less than 30 years of age.

Visa’s International Financial Literacy by Visa Company (2012)

Report show that the actions of individuals who are financially literate do not
necessarily mean they will demonstrate good financial behaviour. In order to improve the
financial behaviour of consumers, two critical areas need to be addressed. Firstly, the
objectives of financial literacy programs should be not only to educate consumers about
financial markets and products but highlight to individuals the psychological biases and
limitations that they as humans cannot easily avoid. Secondly, the regulation of financial
products sold to consumer’s needs alteration to meet the aim of protecting retail consumers
from complex financial products that are confusing, ambiguous and inappropriate. A survey,
conducted by Visa, found that 34% of Indian women and 29% of Indian men claimed to have
no savings. Similarly, it revealed that 43% of Indian women do not discuss matters of money
management with their children, due in large part to their own lack of understanding. It is no
surprise that in a society where women are less likely than their male counterparts to engage
in paid work, and are therefore not expected to undertake decisions relating to the family
budget, they do not educate their children in these matters. According to the annual
MasterCard’s index for financial literacy. Only Japan fared worse with 57 points. In terms of
overall financial literacy, India is at the bottom among 16 countries in the Asia-pacific region
India is above with 59 index points from Japan, the index is based on a survey conducted
between April 2013 and May 2013 with 7,756 respondents aged 18-64years.The survey
polled consumers on three aspects — basic money management (50% weight), financial
planning (30% weight) and investment (20% weight) — to arrive at the overall financial
literacy index. On individual parameters, India scored 50 index points in basic money
management. The report states that for Indians, “the lack of ability to keep up with bills, set
money aside for big item purchases and to pay off credit cards fully could be due to a lack of
surplus cash, resulting from the fact that income levels are not high enough to cover
expenses”. Interestingly, the financial literacy scores for Indians aged 30 and above were 59
compared with 61 for those less than 30 years of age.

Assessing The Financial Literacy Level Among Women in India: An Empirical Study by
Bernadette D’Silva, Stephen D’Silva and Roshni Subodhkumar Bhuptani in Journal of
Entrepreneurship and Management Volume 1 Issue 1 February 2012.
This report states results from the analysis have revealed that though most of females
do have certain financial security in India, but they are still financially illiterate. Mostof the
females including those living in urban areas are not aware of different investment options
with regards to various financial instruments. Most of females have invested their surplus
funds either in banks or in insurance schemes. Very few have actually opted for stockmarkets
or mutual funds for investing their funds. The major reason behind this is that femalesin India
are highly ignorant about the recent financial innovations in the markets, which can highly
increase their returns on investment. Moreover it has also been found that, females arehighly
risk averse and do not want to risk their hard earned money in those financial instruments that
can give rich capital gains on their investment.
The study also indicates that many females also lack the knowledge of using onlineservices
for making prompt bill payments or transferring the funds to another account. They are also
provided with debit and credit cards, but hardly do they make any use of it. It has been found
that females do not use the services of financial consultants in managing their investment
portfolios. This indicates that women in spite of having better financial services,they do not
use it optimally so as to save their time and money. Further analysis of the paperindicates that
though there is improvement in financial status of female, but still in the Indiansociety, there
are very few exceptions where women actually participate or have that kind of autonomy to
take decisions with respect to monetary investments in the family. The increasing
liberalisation in social status of women has definitely shown positive change in condition of
women in India. Education has empowered women in a very significant manner. Though most
of females do not take major financial decisions in their household, but working females
especially in metro cities serve as an outstanding example for the working women residing in
other parts of the country. Women in urban areas have financial freedom to take decisions
not only with respect to their personal investments but also for the family as a whole.

Planning and Financial Literacy: How Do Women Fare? by Annamaria Lusardi and
Olivia S. Mitchell in National Bureau Of Economic Research, Cambridge, January 2008.
According this report, policymakers seek to learn whether households are
effectively protected for many years in retirement, which is argued in this report is intimately
related to whether they know how to plan for retirement and whether they can execute these
plans effectively. Indeed, posit that this topic is of particular interest for women who tend to
live longer than men and have shorter work experiences and lower earnings. Moreover, the
large majority of women have not done any retirement planning calculations. Further,
financial knowledge and planning are closely related: women who display higher financial
literacy are more likely to plan and be successful planners. Findings raise concerns about the
ability of women to make sound saving and investment decisions over a long retirement
period. In an environment where individuals rather than employers and governments are
charged with handing retirement finances, it is essential that consumers become more
financially literate in order to be more successful at retirement. Several questions are left
unexplained, such as why women are so financially illiterate and what might be the best ways
to address financial literacy among this segment of the population.