bracket, the proportion of italian senior high school graduates rose to 70 per cent, against an oecd average of 81 per cent. the proportion of children completing junior high school studies has also been rising, gaining more than 10 points in recent years to over 80 per cent. for university education, however, the gap is certainly worrying. here, italy seems hard put to keep up with the other advanced countries : again in 2009, the proportion of graduates in the 25 – 64 age group was less than 15 per cent, or just half the oecd average ; amongst people aged between 25 and 34 years, it exceeded 20 per cent, compared to an oecd average of around 37 per cent. over the past twenty years, direct testing of reading comprehension, logical and mathematical skills, and the ability to combine pieces of information to solve problems of varying complexity, reveals a similarly worrying picture. at the end of primary school italian students are at least as skilled as in the other developed countries, but in the later stages of formal education they fall behind. for 15 - year - olds, the gap found by the pisa survey carried out by the oecd in 2006 corresponded to around one school year ; and although this diminished between 2006 and 2009, it remained significant. the gap reflects severe disparities between different parts of italy, with the scores in the north slightly above the oecd average and those in the south dramatically lower. these disparities are subject to various interpretations involving their geographical distribution or the discrepancies between different schools rather than within any individual school. yet the fact remains that a country like ours, poor in material resources and now lagging on various fronts, should invest in “ knowledge ”, not “ below ” or “ around ” but above the average of other countries with more natural resources. such deficits are also observed in respect of the skills of the adult population. the international adult literacy and lifeskills survey ( all ) conducted in 2003 to gauge functional literacy and numeracy together with analytical and problem - solving abilities shows that about 80 per cent of italians aged between 16 and 65 are unable to apply linear reasoning and draw inferences of average complexity by extracting and combining information provided in written texts that are little more than basic. they are, that is to say, functionally illiterate : they lack adequate reading comprehension, logical and analytical skills to respond to the demands of modern life and work. this is the highest percentage in any of the

the private sector that has to take the lead in this move of creating jobs to convert the demographic dividend to our advantage. again, in the context of employment bis central bankers ’ speeches creation, the banks have a very major role to play. we are all aware that mses are a primary driver for job creation and gdp growth in our economy and, therefore, fostering a dynamic mse sector should be a policy priority. the statistics, however, present a sorry state of affairs insofar as the performance of banks in lending to mse sector is concerned. the number of borrower accounts has remained virtually stagnant over the past three years. if the banks have to make a significant contribution to creation of jobs in the economy, they would need to lay sharper focus on their financial inclusion and financial literacy initiatives so that not only demand for financial services is generated, but millions of micro - entrepreneurs also get created in the process. financial inclusion 39. financial inclusion has been a focus area for the reserve bank and we consider it to be an imperative for achieving inclusive growth and for promoting social sustainability. we all know from personal experience that economic opportunity is strongly intertwined with access to financial system. such access is especially powerful for the poor as it provides them opportunities to build savings, insure themselves against income shocks and to meet emergencies without falling into the clutches of the usurious money lenders. financial inclusion will also pave the way for electronic benefit transfer ( ebt ) for payment of social security and other benefits, which will minimize transaction costs as well as leakages. in parts of the country where such ebt has already taken off, the results are impressive and the experience of both payers and recipients extremely satisfying. financial inclusion is a global public good ; for the poor, for the banks and for the nation and hence, the reserve bank remains deeply committed to the financial inclusion agenda. 40. our approach has been threefold – first, increasing the reach of banking by providing doorstep banking in remote areas using technology based solutions ; second, fostering innovation through the introduction of new products and services designed for the poorer segments and third, ensuring a supportive and enabling policy environment. 41. there is strong research evidence to suggest that this social banking experiment in india has been successful in improving the credit flows to the rural population and even in lowering poverty as a result. looking at the numbers, the average population per bank branch has improved from 15, 583 in 2001 to 12, 60