INTRODUCTION:

Organization for Economic Co-operation and Development (OECD) defines Financial Literacy as “a combination of awareness, knowledge, skill, attitude, and behavior necessary to make sound financial decisions and ultimately achieve individual well-being (OECD, 2011)”. Financial literacy helps individuals to improve their level of understanding of financial matters which enables them to process financial information and make informed decisions about personal finance. According to PISA (2012) financial literacy is “Financial literacy is knowledge and understanding of financial concepts and risks, and the skills, motivation and confidence to apply such knowledge and understanding in order to make effective decisions across a range of financial contexts, to improve the financial well-being of individuals and society, and to enable participation in economic life.” Financial literacy is a ability to control and manage the personal finances. Financial literacy is important for several reasons. Financially literate consumers are able to sail through tough financial times because of the fact that they might have accumulated savings, purchased insurance and diversified their investments (OECD, 2011). Financial literacy is also directly correlated with positive financial behaviour such as timely payment of bills and loan instalments, saving before spending and using credit card judiciously. Research has shown that levels of financial literacy worldwide are unacceptably low. Financial literacy and proper financial attitude are essential for financial wellbeing and economic empowerment of individual (Haque and Zulfiqar, 2016). Developing countries have much less financially literate population as compared to developed countries. People find it difficult to take decisions regarding personal finance issues confidently and often make mistakes. The governments and various organizations such as Economic Co-operation and Development (OECD), the U.K. Department of International Development (DFID), and the World Bank are promoting financial literacy in developing countries by imparting financial education.

Financial education empowers individuals to take their financial decisions in a better way. Financial education programs cover topics such as savings, borrowings, budgeting and making use of financial services (Bhushan, 2013). Awide range of policies and programs—from strengthening economic rights for women under the law to providing women with greater access to quality child careand financial literacy—can potentially spur women’s economic advancement and reduce gender gaps in economic performance (Buvinic M and Furst-Nichols R, 2014). Financial literacy is mainly related with decisions related to personal financial matters. But with the economic and market growth financial literacy has gained much more importance (Shanti and Murty, 2019)

Financial Literacy = Financial Knowledge + Financial Behaviour + Financial Attitude.

Financial knowledge= Basic Calculations. (SI and CI)

Financial Behaviour = Handling their finances

Financial Attitude = Financial Planning and Decision Making. (OECD, 2011 and Arora, 2016).

Financial knowledge implies that are able to make rational choice among different financialalternatives based on their inclusive knowledge of everyday financial matters. Financial knowledge deals with the familiarity with simple and compound interest, basic principles of savings and investment, the impact ofinflation on price and risk-return relationship etc. Financial Attitude implies the financial planning and sustainability for the future and wise decision making in finance and investing wisely. Financial behaviour refers to the contents of savings, loans, finances, gold loans etc., and how the individual is handling personal finances. A study on gender differences regarding financial literacy, women’s financial knowledge is worse than that of men and they are less confident in financial skills (Hung, 2012).Financial education, financial consumer protection and financial inclusion are recognised at the highest policy level as three essential ingredients for the financial empowerment of individuals and the overall stability of the financial system, as highlighted through three sets of high-level principles endorsed by G20 leaders: Innovative Financial Inclusion (2010); Financial Consumer Protection (2011); and National Strategies for Financial Education (2012).

Women’s Empowerment

Women are a financially weaker section of society. Gender disparity, gender segregation, and Glass ceiling – the gender gap are the ill effects of poor financial management among women. Zan, Zar, and Zameen (woman, money, and land)—is the root cause of every evil and brings absolute disregard for women. It reveals that women are treated as a commodity like money and land (Azra and Hafiz, 2017). The stance that women empowerment is desirable for efficiency shapes both the policy debate and the resultant economic policies the world over. Gender equality and women’s empowerment is the third of eight MDGs. It is an intrinsic rather than an instrumental goal, explicitly valued as an end in itself rather than as an instrument for achieving other goals.

The concept of empowerment can be explored through three closely interrelated dimensions: agency, esources, and achievements (Naila K, 2010). Agency represents the processes by which choices are made and put into effect. It is hence central to the concept of empowerment. Resources are the medium through which agency is exercised; and achievements refer to the outcomes of agency. (Naila K, 2010). Women empowerment and economic development are closely related: in one direction, development alone can play a major role in driving down inequality between men and women; in the other direction, empowering women may benefit development. Economic Empowerment of women is constrained by certain socio-cultural factors which include problem to access employment, gender differences in pays, and harassments that pose restriction on women to access and control over assets (Akram et. Al., 2015 mentioned Wub, 2010). Empowerment of women is essential for the family and community development. Economic Empowerment of women is prerequisite for sustainable economic development and social welfare.

Gender discriminatory social norms are a widely recognized barrier to women’s economic empowerment, affecting both their access to “decent work” and their experience in workplaces. The study of a broad-based empowerment program (Mahila Samakya) showed its potential to contribute to norm change that underpins economic empowerment over a sustained period (15 to 20 years), but also highlighted the persistence of norms related to sexuality and gender-based violence. women’s economic empowerment was associated with increased intimate partner violence (IPV) as a form of backlash against loss of male control over women’s time, labour, and mobility (Marcus, 2018). Besides the economic dimension, five other dimensions of Empowerment were studied (familial, legal, psychological, political and socio-cultural) by different. Amongst these the economic empowerment is focused one. Daraka Chay (2011), worked on a paper, Women’s economic empowerment through microfinance in Cambodia, reasons for investigation was to evaluate the how the loans were beneficial for the women to become self-sufficiency. Micro finance played a positive impact in Combodia on specifically Women.

However, research suggests that 62 percent of Indian women, which is an approximate figure of 411 million, either do not own a bank account or have limited access to banking services (Gupta and Das, 2021). Financial literacy is playing a fruitful role in both the genders (male and female). Financial Literacy means the capability to make effective decisions regarding the use of money. Working at the grassroots level is the key to empower lives in rural India. Financial education programs cover topics such as savings, borrowings, budgeting, and making use of financial services.

Global Data on Financial Literacy:

Figure. 1: Global Financial Literacy Excellence Center, 2015

The above figure shows the of overall financial literacy, US statistics in comparison with worldwide, and overall men and women financial literacy in worldwide. 33% of adults worldwide are financially literate. US more than 50 percentage of adults are financially literate compared to 33% of adults worldwide. Gender wise, worldwide 35 percentage of men and 30 percentage of women are financially literate. The purpose of this study was to explicate the concept of financial literacy by analyzing the many ways in which it has been interpreted and measured in research since 2000, the start of the decade in which the push for greater education and empowerment began taking solid root (David, 2010).

Figure.2: The above figure shows the Financial Literacy Level Across Globe, 2015 from Anshika, 2017.

According to 2015, the financial literacy rate percentage in India is 24% (Anshika, 2017). Financial literacy stands the highest in Norway, Sweden and Denmark i.e. 71 percent. In BRICS (Brazil, Russia, India, China and South Africa) countries, the level of financial literacy is as low as 28 percent. Among BRICS, India has the lowest rate of financial literacy (24 percent). According to the survey conducted by Standards andPoor‟s, over 76 percent Indian adults lack basic financial literacy and the most basic and key financial concepts.

Table.1: The following table shows the state wise general literacy and their financial literacy percentage of India

Name of state

General Literacy (in Percentage)

Level of Financial Literacy (in Percentage

Andhra Pradesh

Arunachal Pradesh

Assam

Bihar

Chhatishgarh

Goa

Gujarat

Haryana

Himachal PRADESH

Jammu and Kashmir

Jharkhand

Kerala

Madhya Pradesh

Maharashtra

Manipur

Meghalagya

Mizoram

Nagaland

Odisha

Punjab

Rajasthan

Sikkim

Tamil Nadu

Tripura

Uttar Pradesh

Uttarakhand

West Bengal

Source- Data compiled from the National Centre for Financial Education Report (NCFER), 2015

Kerala being the highly literate state and has the second highest level of financial literacy i.e. 36 percent in India. States like Goa, Manipur and Gujarat stands the highest level of financial literacy at 50 percent, 36 percent, 33 percent respectively, which is still considered very low. Whereas states like Chhatisgarh, Mizoram, Bihar, Nagaland, Sikkim, Odisha, Arunachal Pradesh, Uttar Pradesh, Punjab, Jharkhand, Himachal Pradesh Maharashta has the lowest level of financial literacy i.e. below 20 percent.

STATEMENT OF THE PROBLEM:

There is abundant research available on gender, women and their empowerment, socio-economic challenges to women’s financial self-sufficiency, women and financial literacy etc. However, a little work is done on providing collective evidence on the understanding of women, financial literacy and their empowerment. This work, accordingly, combines the analysis of different researchers and attempts to provides a holistic understanding of the issue under investigation and investigates the various socio-economic and cultural factors that either aid or hinder women empowerment in relation to financial literacy.

OBJECTIVES:

1. To analyze how financial literacy among women has been researched and understood by researchers.

2. To provide a collectivized understanding on women, types of financial engagements, empowerment with respect to financial literacy.

METHODOLOGY:

In this work previous research on women’s empowerment and financial literacy has been collected and synthesized. The technique used is semi-systematic review (Wong et al., 2013). The literature that was relevant for understanding various research traditions was identified. Eight articles were collected in relation to the financial literacy and women empowerment. Narrative analyses was used in identifying, analyzing and establishing patterns that related to women, their empowerment and their financial literacy.

Literature review Analysis:

Author and Year	Title of the article	Analysis
Arora, Akshita. (2016).	Assessment of Financial Literacy among working Indian Women. Business Analyst.	Their sample consists of working educated women and expected widespread financial knowledge. But contrary to the expectations, a few women scored well in terms of financial knowledge and few scored less. So, it can be inferred that women have positive behavior towards money and financial matters, reflecting their prudence, discipline, and alertness. However, they do not fair well while dealing with financial matters.
Bhushan, Puneet andMedury, Yajulu. (2013).	Financial literacy and its determinants.	The level of financial literacy varies significantly among respondents based on various demographic and socio-economic factors. Financial literacy level gets affected by gender, education, income, nature of employment, and place of work whereas it does not get affected by age and geographic region.
Cornish H, Walls H, Ndirangu R, Ogbureke N, M. Bah. O, Tom-Kargbo. J.F, Mattia D and Ranganathan M (2021).	Women’s economic empowerment and health-related decision-making in rural Sierra Leone, Culture, Health and Sexuality.	Maternal mortality rates during childbirth in Sierra Leone are amongst the highest globally, with 1360 maternal deaths per 100,000 live births. The government launched Free Health Care Initiative (FHCI) for pregnant women and children under five to access medical care and services free of charge. Globally, Men control Health decision-making. Two factors behind this Patriarchy and Inheritance controlled by men. Women enjoying financial Independence but not health decision making
Daraka Chhay, (2011).	Women’s Economic Empowerment through microfinance in Cambodia.	The use of microfinance to enhance income generation and job opportunities among the poor involved the raisings of the standard of people. Women spend their income on households and children, which can potentially spur women’s economic empowerment and reduce gender gaps.
Marcus. R, (2018).	The Norms Factor: Recent research on gender, social norms, and women’s economic empowerment.	Gendered Discriminatory social norms are widely a barrier to women’s economic empowerment, affecting both their works (household and work). Norms concerning reputation and decorum, adolescent marriage and childbearing, widespread work-related sexual violence constraints women’s economic activity these norms affect women's empowerment. Factors to change the norms are large scale economic change and empowerment programs
Monika, D., Harsh, P., and Divya, M, (2015).	Improving Financial Literacy among Women: The Role of Universities.	The financial literacy and inclusion in India report by NCFE 2015 show that there is a strong need for financial literacy awareness all across India. Individuals from rural areas have a low level of literacy as well as socio-economic inclusion which shows that there is a lack of awareness and low access to financial services. Women are a special concern in this regard. Rural women involved in agricultural labor and housewives have the lowest scores.
Nithyananda, N., and Umesh, M. (2020).	Financial Literacy Among the Rural Women: A study with reference to Kundapur Taluk.	Financial education has to begin at the school level. Learning of financial literacy (Savings, Borrowings, etc) programs should be initiated at the high school level.

FINDINGS AND DISCUSSION:

Financial literacy is the ability to make informed judgments and to take effective decisions regarding the use and management of money. Financial awareness and engagement with economic activities are the steps for self-sufficiency. The growth of financial literacy should be from childhood and to participate in those programs which are beneficial for an individual. Women empowerment and financial literacy are dependent on each other. Economic empowerment is a combination of an individual’s knowledge, ability, skills, and confidence for handling her financial wellbeing. Women are unable to take health-related decisions unless they are dependent on themselves. The decision-making power in economic activity, health, and education are under men's domain. Age, gender, marital status, education are the main determinants for financial literacy. financial literacy, financial attitude, and financial knowledge are positively and significantly related to economic empowerment. The government programs which providing loans for women are engaging the women into self-sufficient it boosts towards real empowerment. Even after the empowerment, the social constraints, and norms are affecting the women in the workplace. Economic empowerment programs lead to change in gender norms.

CONCLUSION:

From the above analysis, we can draw that the need for financial literacy in women. This concept suggests that level of financial literacy varies significantly among respondents based on various demographic and socio-economic factors. It can be concluded that financial literacy level gets affected by gender, education, income, nature of employment, and place of work whereas it does not get affected by age and geographic region. Financial literacy helps women in becoming real empowered women.

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Received on 10.05.2023 Modified on 24.06.2023

Int. J. Ad. Social Sciences. 2023; 11(3):131-136.

DOI: 10.52711/2454-2679.2023.00020