RBI UNVEILS NATIONAL STRATEGY FOR FINANCIAL EDUCATION FOR THE PERIOD 2020-2025

RBI UNVEILS NATIONAL STRATEGY FOR FINANCIAL EDUCATION FOR THE PERIOD 2020-2025

RBI on 20th August, 2020 has unveiled the National Strategy for Financial Education (NSFE) for the period 2020-2025.


This is the 2nd NSFE, the first one was launched and implemented for the period 2013-2018. The 2nd NSFE was launched with the aim to make the country financially aware and empowered.
 

Brief details regarding National Strategy for Financial Education (2020-2025)

1.  Based on the progress and review of the first NSFE (2013-2018), the National Centre for Financial Education (NCFE) in consultation with all the Financial Sector Regulators such as the Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), Insurance Regulatory and Development Authority of India (IRDAI) and Pension Fund Regulatory and Development Authority (PFRDA), has prepared the NSFE (2020-2025). Preparation has been done under the guidance of the Technical Group on Financial Inclusion and Financial Literacy (TGFIFL), which is headed by the Deputy Governor of RBI

2.  The NCFE is a section 8 Company under the Companies Act, 2013. It is not a profit-oriented company. The NCFE is promoted by the four financial regulators of the country and they are RBI, SEBI, IRDAI, and PFRDA.

3.  The NCFE aims to ensure that the financial well being of the majority of the people belonging to the country is protected. They try to empower these people by promoting adequate knowledge, skills, attitudes, and behavior, that are needed for managing the money better and to plan the future accordingly.
 


 

4.  The objective of the NSFE (2020-2025) is as follows:

  • To infuse the concept of financial literacy among the various sections of the population by way of financial education and making it an important life skill.
  • To encourage the habit of saving.
  • To motivate the people for participating in financial markets to meet financial goals and objectives.
  • To inculcate the credit discipline and encourage the people to avail credit as per the requirements only from the formal financial institutions.
  • To promote the habit of using digital financial services in an efficient manner i.e safe and secure manner.
  • To take the proper insurance cover in order to manage the risk involved at various life stages.
  • To effectively plan for retirement by availing the suitable pension product.
  • To make them aware of rights, duties, and avenues for grievance redressal.
  • To improve the research and evaluation methods in order to assess progress in financial education.
     

5.  Recommendation of a ‘5 C’ approach for dissemination of financial education in the country such as  Content, Capacity, Community, Communication, and Collaboration:
 

Content
  • Financial Literacy content for school children (including curriculum and co-scholastic), teachers, young adults, women, new entrants at workplace/entrepreneurs (MSMEs), senior citizens, persons with disabilities, illiterate people, etc.
Capacity
  • Develop the capacity of various intermediaries who can be involved in providing financial literacy.
  • Develop a ‘Code of Conduct’ for financial education providers
Community
  • Evolve community-led approaches for disseminating financial literacy in a sustainable manner.
Communication
  • Use technology, mass media channels, and innovative ways of communication for the dissemination of financial education messages.
  • Identify a specific period in the year to disseminate financial literacy messages on a large/ focused scale.
  • Leverage on Public Places with greater visibility (e.g. Bus Stands, Railway Stations, etc.) for meaningful dissemination of financial literacy messages.
Collaboration
  • Preparation of an Information Dashboard.
  • Integrate financial education content in school curriculum, various Professional and Vocational courses (undertaken by the Ministry of Skill Development and Entrepreneurship (MSD&E) through their Sector Skilling Missions and the likes of B.Ed./M.Ed. programs.
  • Integrate financial education dissemination as part of various on-going programs.
  • Streamline efforts of other stakeholders for financial literacy.

 

6.  The Strategy recommends a multi-stakeholder approach for the people of India in order to maintain their financial well being. It also suggests the adoption of a strong ‘Monitoring and Evaluation Framework in order to assess the progress made under the NSFE implementation.
 

For more details regarding the NSFE(2020-2025), kindly click on the below-mentioned link –

https://www.rbi.org.in/Scripts/PublicationReportDetails.aspx?UrlPage=&ID=1156
 

Edited by Minu Mishra

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