The Role of Financial Literacy in Promoting Financial Inclusion
Dr. Batani Raghavendra Rao1, Ankit Keshri2, Affrose G M2, Deepesh Agarwal2, Likhita M Y2, Mohammed Sufiyan Khan M D2, Mohammed Mudassir Ahmed2, Naman Bohra2 and Pavun Kumar V M2
1Professor, 2MBA, Faculty of Management Studies, CMS Business School,
JAIN (Deemed-to-be-University)
Bangalore, India
Abstract: The study explores the important connection between financial knowledge and financial access, highlighting how understanding finances can lead to increased use of official financial services. Being financially literate helps people effectively handle their finances by learning how to save, invest, and borrow wisely. The research shows that people with better financial knowledge are more likely to use formal financial services such as banking and credit, promoting financial inclusion. Marginalized populations like women, those living in rural areas, and low-income individuals greatly profit from specialized financial education initiatives, becoming more self-assured in handling their money and engaging in the legitimate economic sector.
The document also delves into how technology can improve financial inclusion with digital financial services (DFS). People who are knowledgeable about finances are more inclined to utilize mobile banking, e-wallets, and other digital platforms, which enhances their financial status. Nevertheless, the study points out major obstacles such as the narrow coverage of financial education initiatives in rural regions, as well as socio-cultural hindrances that limit financial inclusion for specific population groups.
Suggestions include establishing guidelines to encourage basic financial education at the community level and designing easy-to-understand financial services specifically for marginalized groups. Furthermore, the paper suggests implementing ongoing, flexible financial education programs to match changing financial environments. In conclusion, the study highlights the significance of financial knowledge in promoting long-term economic development via accessible financial structures.
Keywords: Financial Literacy, Financial Inclusion, Financial Education, Banking Access, Digital Financial Services, Personal Finance, Economic Empowerment
