Title: A Review of Financial Literacy and Gender Issues in India

Financial literacy has been identified as a key element of meeting the crucial goal of financial inclusion and subsequently, financial stability. Organization for Economic Co-operation and Development (OECD) has defined financial literacy as, “a combination of awareness, knowledge, skill, attitude and behaviour necessary to make sound financial decisions and ultimately achieve individual financial wellbeing”. Financial literacy is emerging as the main focus for policy makers not only in India, but also globally, especially after the global financial crisis. In the Asia-Pacific region nearly 40 countries including India have launched a National Strategy for Financial Education. The Reserve Bank of India has emphasized that together with Financial Inclusion and Consumer Protection, Financial Literacy/Education forms a triad, which is necessary for ensuring financial stability.

In 2010OECD International Network on Financial Education (INFE) created an expert subgroup on Empowering Women through Financial Awareness with an aim to review and understand the cause and consequence of varying levels of financial literacy and to discuss gender-specific approaches to improving financial literacy. In India, middle and lower-middle income working women participate in financial markets as either savers and/or borrowers. Yet issues of women population having a bank account yet refraining from participating in the capital market on account of lack of knowledge exist. It has been found that gender disparities in financial literacy compound women's difficulties in securing their financial well-being and in participating confidently in economic activities. Women also have peculiar financial literacy needs, conspicuously as they tend to live longer and get paid less than men, hence being more likely to face financial hardship in old age. Literature suggests that the contribution of financial literacy/education to women's greater participation to economic activities and appropriate use of financial products will benefit the countries’ overall economic growth.