Three-fourth Indian adults not financially literate: S&P survey

KOLKATA: Three-fourth of Indian adults do not adequately understand key financial concepts such as inflation, compound interest and risk diversification, Standard & Poor’s Ratings Services said.

This is lower than the worldwide average of financial literacy, but roughly in line with other BRICS and South Asian nations. In comparison, 57% of adults in US and 67% in UK are financially literate.

The findings showed that despite Indian government's and Reserve Bank of India's financial inclusion drive, there has not been much progress on the financial literacy front.

RBI is, in fact, preparing a comprehensive policy to improve this aspect, Governor Raghuram Rajan had said last week. .

S&P has interviewed more than 150,000 adults across over 140 countries for its global financial literacy survey. Individuals were tested on their knowledge of four basic financial concepts: numeracy, risk diversification, inflation, compound interest.

The survey showed that three-quarters of Asian adults and two-thirds of adults worldwide are not financially literate. In Asia, Singapore is home to the highest percentage of financially literate adults with 59%, followed by Hong Kong and Japan (both at 43%). And less than a third of adults in China (28%) are financially literate.