India's households show uneven financial maturity despite widespread financial inclusion
Updated
Updated · The Economic Times · May 10
India's households show uneven financial maturity despite widespread financial inclusion
6 articles · Updated · The Economic Times · May 10
An IIM Udaipur-PRICE study in Gujarat and Rajasthan found fewer than 40% can cover three months' expenses, though more than a third have recently faced financial shocks.
Many still depend on family borrowing, asset sales or costly credit, while weak understanding of compounding, inflation and diversification limits long-term planning and policy transmission.
The report says India has opened more than 55 crore bank accounts, but policymakers should shift from access metrics to capability-based measures and tackle behavioural barriers, trust and financial education.
India built a world-class digital payment system. Why are its users still struggling with basic financial planning?
With easy digital loans booming, are Indian households being empowered or trapped in a new cycle of debt?
Financial Maturity Index: Unlocking the Next Phase of India's Financial Well-being
Overview
India has made remarkable progress in financial inclusion, as shown by the steady rise of the Financial Inclusion Index from 2017 to 2024. This reflects improved access to banking, insurance, investments, and pensions, leading to broader integration of people into the formal financial system. Digital finance has played a key role in expanding access and efficiency, offering new opportunities for poverty reduction. However, despite these achievements, India now faces the challenge of moving from widespread access to true financial maturity, highlighting the need to bridge gaps in financial literacy and capability for lasting economic well-being.