An increased need for financial education is felt in both developed and developing countries. In developed countries, the increasing number of financial products, its complexity, importance of retirement savings, increased growth of secondary market has made the imparting of financial education imperative for all age groups, including students so that individuals are educated about financial matters as early as possible in their lives.
In the developing countries, the growing number of investors, technically advanced financial markets, liberalized economy etc. necessitates imparting of financial education for better operation of markets and economy and in the interest of investor. Further imparting of financial education is international concern due to growth of international transactions, international financial instruments like ADR, GDR etc., mobility of individuals from one country to another etc.
Initiatives taken so far on Financial Literacy in India
Investor education forms an important part of SEBI‟s efforts to protect the interest of the investors in securities markets. A series of information brochures and pamphlets have been issued in the past for the benefit of the investors. These publications indicate the various risks associated with capital market investment, the rights of the investors, the responsibilities and details of the grievance redressal machinery available to them and the remedy/relief to be obtained from different agencies like SEBI Ministry of Company Affairs, Stock Exchanges, Reserve Bank of India and Registrars to the Issue, apart from seeking relief through Consumers Disputes Redressal Forums, Company Law Board and Court of Law.
The investors‟ associations registered with SEBI, the stock exchanges and professional bodies also conduct investors‟ education programmes from time to time to appraise the investors of the changes in the law and regulations and the methods of protecting themselves against malpractices and delays cropping up in the market. This is further supplemented by the journals and magazines in the field of corporate investment as well as newspaper articles which highlight the newly emerging problems, pitfalls and the methods to protect.
Securities Market Awareness Campaign
SEBI has also launched a comprehensive securities market awareness campaign for educating investors through workshops, audio – visual clippings, distribution of educative investor materials/booklets, dedicated investor website etc. It has also recognized certain investor associations through which the investor is educated.
Financial Literacy – cum – Counselling Centre
RBI has advised State Level Bankers‟ Committee convenor banks to set up, on a pilot basis, a financial literacy – cum – counseling centre in any one district, and based on the experience gained, to ask the concerned lead banks to set up such centres in other districts. It has also undertaken a project on financial literacy by asking banks to introduce comic books explaining terms like inflation, how to open an account, interest rates, etc.
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