Modi Ji was speaking. “India is still a developing country and it is our duty as a nation to provide all necessary assistance to the poor people in the country. Not only for the government, for everyone this should be a priority. I am very clear. However, the means that we use to provide support to the poor should be such that they empower the poor and not such that their poverty is used to maintain political power.”
It was August 2013. He was not yet even the declared prime-ministerial candidate of BJP as we sat talking in his room at Mahatma Mandir in Gandhinagar.
I already had a good sense of what he meant. During 2005, I came across Wadi project in Vansda, Gujarat. It was a dryland inhabited by tribals and had small holdings of land from one acre to five acres. They had no access to education and had adopted traditional ways of farming. They were encouraged to start cashew and mango cultivation and other income generation activities. SHGs were formed and were trained in pot-drip making, digging ponds for watershed, vermicomposting and so on. After considerable financial literacy efforts, habits of thrift and savings were also formed. Such was the intervention that changed the economic plight of people.
I was dumbfounded to discover the facts of life that vulnerable sections of our society live with. It lacked even rudimentary knowledge about savings, credit and investment decisions to ruthless exploitation – from moneylender sharks, for instance. At the same time, I was also astonished by the policy indifference to the cardinal truth, as I wrote in my first book, Financial Inclusion, of “linking access to financial services with livelihood options and leveraging the same to achieve poverty eradication”.
The importance of financial literacy lies in the fact that it helps propel people at the bottom-of-the-pyramid towards formal credit, thus freeing them from the clutches of moneylenders. When individuals start businesses, use their capital, invest their savings—however small— provide for their futures, the economy as a whole takes off. Much ahead of launching of PMJDY, Finance Minister Arun Jaitley, while stressing the importance of financial literacy, had said, “It is essential that people understand the importance of availing financial services, which will enable them to participate in India’s growth story. Therefore, financial literacy will receive a special emphasis in this new programme of financial inclusion.”
Based on my learnings from across the country and particularly successes in Gujarat, I created SAMAVESH Financial Literacy programme. It is my firm belief that for financial literacy to be effective, it needs a whole lot of field work and mobilisation to identify participants with high quality resource persons. This, then makes it a resource intensive exercise that requires to be repeated often to have optimum impact. Also, it requires to cover not just banking but also insurance, micro-investments, pensions and annuity incomes.
I met Modi Ji in Gandhinagar and presented him a copy of my book ModiNomics on 21 February 2014. On the same day I had organised the financial literacy training for women in association with his government in Gujarat. 231 women from all across the state came to participate in the full-day SAMAVESH financial literacy programme at Mahatma Mandir in Gandhinagar. Dr Varesh Sinha, the then Chief Secretary of Gujarat participated and said, “SAMAVESH encapsulates the Sabka Saath, Sabka Vikas mantra given by Chief Minister Modi.”
Later, several Chief Ministers and Ministers were to invite SKOCH to conduct this useful programme in their areas and they made it a point to attend.
Financial literacy is suffering today from the dogma that it is to be imparted only not-for-profit interest or by media. The reality is that the money is being wasted on English business TV channels preaching to the already financially literate. Advertising is disguised as financial literacy right under the regulatory nose. Let us not forget, the BC model became successful only after my recommendation to allow corporate BCs was accepted.