Lok Sabha Question No. 4650 (UNSTARRED), answered on 2020-03-23
Subject: Survey on Financial Literacy
Ministry: FINANCE
Asked by: Sudheer Gupta, Sanjay Sadashivrao Mandlik, Gajanan Chandrakant Kirtikar, Shrirang Appa Barne, Bidyut Baran Mahato

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOKSABHA UNSTARRED QUESTION No. 4650

ANSWERED ON 23 rd MARCH, 2020 (MONDAY)/CHAITRA 3, 1942 (SAKA)

## Survey on Financial Literacy

4650. SHRI SUDHEER GUPTA: SHRI SANJAY SADASHIV RAO MANDLIK: SHRI GAJANAN KIRTIKAR: SHRI SHRIRANG APPA BARNE: SHRI BIDYUT BARAN MAHATO:

Will the Minister of FINANCE be pleased to state:

- (a) whether the Reserve Bank of India (RBI) has conducted surveys to measure financial literacy in rural population of the country and if so, the details thereof and the outcome of the survey, State/UT-wise;
- (b) whether the Government has an action plan to increase personalised banking services to improve financial literacy and awareness in rural areas and if so, the details thereof;
- (c) whether RBI has also advised Financial Literacy Centres of banks and rural branches to conduct special camp for newly included people in the financial system and if so, the details thereof;
- (d) the ratio of public and private sector banking agents to population in the rural areas, State/UTwise; and
- (e) the other steps taken/being taken by the Government to improve the financial literacy in rural population of the country?

## Answer

## THE MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI ANURAG SINGH THAKUR)

- (a) and (b) As apprised by Reserve Bank of India (RBI), they have conducted a pan-India Financial Literacy and Inclusion survey in 29 States and 5 Union Territories (excluding Andaman & Nicobar Islands and Lakshadweep Islands). Under this survey, financial literacy was measured across three components namely financial knowledge, attitude and behaviour. Further, the maximum score for the three components of financial knowledge, financial attitude and financial behaviour are 7, 5 and 9 respectively. India's average scores in the three components are 3.7, 2.6 and 5.6 respectively and for financial literacy it is 11.9 out of the total score of 21.

As apprised by RBI, although, the State-wise financial literacy scores, based on the survey, for rural areas are not available, the same is available zone wise. The average score for different zones is as under:

| Zone    |   Overall Financial Literacy Score |   Urban |   Rural |
|---------|------------------------------------|---------|---------|
| North   |                               11.5 |    11.5 |    11.5 |
| East    |                               12.1 |    12.1 |    12.1 |
| Central |                               12.4 |    12.5 |    12.1 |
| West    |                               12.6 |    12.6 |    12.5 |
| South   |                               11   |    11.2 |    10.3 |

Source: RBI

- (c) to (e) RBI, vide circular dated 14.01.2016, had advised the banks to conduct special camps for the newly included people in the financial system including Pradhan Mantri Jan-Dhan Yojana (PMJDY) account holders, for a period of one year. Accordingly, Financial Literacy Centres (FLCs) of banks and rural branches of banks across the country had conducted special camps for newly inducted people in the financial system during the period January 2016 to March 2017 as per details given below:

| Period         | Number of Camps   | Number of Camps   | Number of Camps   | Number of Camps   | Number of Camps   |
|----------------|-------------------|-------------------|-------------------|-------------------|-------------------|
|                | Jan16 - Mar 16    | Apr16- Jun16      | Jul16- Sep16      | Oct16- Dec16      | Jan17- Mar17      |
| FLCs           | 5,990             | 7,838             | 9,501             | 11,676            | 9,591             |
| Rural Branches | 34,115            | 38,568            | 37,983            | 36,918            | 37,528            |

Source: RBI

Further, as advised by RBI, financial literacy camps are organised by FLCs and rural branches of banks. Following are the numbers of such camps organised by FLCs and rural branches in the country:

| Period         | FY 2017-18   | FY 2018-19   | FY 2019-20 (upto Dec.)   |
|----------------|--------------|--------------|--------------------------|
| FLCs           | 1,29,280     | 1,45,427     | 1,13,015                 |
| Rural Branches | 2,64,120     | 3,05,672     | 2,61,428                 |

Source: RBI

As informed by RBI, as on 31.3.2019, there were 5.41 lakh banking outlets in villages providing banking services through Business Correspondents (BCs). State-wise data of banking outlets in villages through BCs is at Annexure. Data regarding ratio of public and private sector banking agents to population for rural areas is not centrally maintained.

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| as referred in reply to in part (d) of the Lok Sabha unstarred Q. No. 4650 for answer on 23.03.2020   | as referred in reply to in part (d) of the Lok Sabha unstarred Q. No. 4650 for answer on 23.03.2020   |
|-------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------|
| State                                                                                                 | No. of Banking Outlets in Villages through BCs                                                        |
| Andaman and Nicobar                                                                                   | 479                                                                                                   |
| Andhra Pradesh                                                                                        | 22,759                                                                                                |
| Arunachal Pradesh                                                                                     | 2,497                                                                                                 |
| Assam                                                                                                 | 21,387                                                                                                |
| Bihar                                                                                                 | 42,536                                                                                                |
| Chandigarh                                                                                            | 150                                                                                                   |
| Chattisgarh                                                                                           | 15,613                                                                                                |
| Dadra &Nagar Haveli                                                                                   | 106                                                                                                   |
| Daman &Diu                                                                                            | 17                                                                                                    |
| Delhi                                                                                                 | 1,087                                                                                                 |
| Goa                                                                                                   | 263                                                                                                   |
| Gujarat                                                                                               | 19,555                                                                                                |
| Haryana                                                                                               | 9,428                                                                                                 |
| Himachal Pradesh                                                                                      | 7,363                                                                                                 |
| Jammu &Kashmir                                                                                        | 3,516                                                                                                 |
| Jharkhand                                                                                             | 25,676                                                                                                |
| Karnataka                                                                                             | 26,117                                                                                                |
| Kerala                                                                                                | 2,728                                                                                                 |
| Lakshadweep                                                                                           | -                                                                                                     |
| Madhya Pradesh                                                                                        | 46,406                                                                                                |
| Maharashtra                                                                                           | 37,842                                                                                                |
| Manipur                                                                                               | 2,263                                                                                                 |
| Meghalaya                                                                                             | 4,315                                                                                                 |
| Mizoram                                                                                               | 426                                                                                                   |
| Nagaland                                                                                              | 803                                                                                                   |
| Odisha                                                                                                | 40,998                                                                                                |
| Puducherry                                                                                            | 92                                                                                                    |
| Punjab                                                                                                | 11,062                                                                                                |
| Rajasthan                                                                                             | 29,698                                                                                                |
| Sikkim                                                                                                | 1,170                                                                                                 |
| Tamil Nadu                                                                                            | 18,817                                                                                                |
| Telangana                                                                                             | 9,749                                                                                                 |
| Tripura                                                                                               | 751                                                                                                   |
| Uttar Pradesh                                                                                         | 90,613                                                                                                |
| Uttarakhand                                                                                           | 10,345                                                                                                |
| West Bengal                                                                                           | 34,502                                                                                                |

Source: Reserve Bank of India