Transformation Through Financial Literacy and Inclusion: A Study of Informal Sector Workers in Kingaon Villege

Journal of Research and Development Peer Reviewed International, Open Access Journal. ISSN : 2230-9578 | Website: https://jrdrvb.org Volume-17, Issue-9(I) | Sept - 2025 115 Transformation Through Financial Literacy and Inclusion: A Study of Informal Sector Workers in Kingaon Villege Dr. Shashikant V. Mundhe, Associate Professor in Economics, Siddharth College of Commerce & Economics, Mumbai. Email: [email protected] Manuscript ID: JRD -2025(I)-170927 ISSN: 2230-9578 Volume 17 Issue 9(I)| Pp. 115-118 Sept. 2025 Submitted: 9 Aug. 2025 Revised: 20 Aug. 2025 Accepted: 20 Sept. 2025 Published: 30 Sept. 2025 Abstract India is a developing country; where large numbers of people are still living in poverty and most of them are illiterate. Hence, financial literacy is required for achieving financial inclusion. Even today, a large number of rural and urban poor either have no access to the institutional finance or they do not know that they can access it. Therefore, financial literacy and inclusion should be given necessary attention. The government of India has aptly identified this and introduced, PM Jan DhanYojana, on 28th August 2014, as a part of its National Mission for Financial Inclusion. Nearly nine months after he launched the first one, Shri. Narendra Modi launched three more financial inclusion schemes on 9th May 2015, namely; Pradhan Mantri Suraksha Bima Yojna, Pradhan Mantri Jeevan Jyoti Bima Yojana and Atal Pension Yojna. Now, it becomes important to know, whether the financial literacy and inclusion has increased considerably or not. The present research paper is a sincere attempt to find out level of financial literacy and inclusion amongst those poor workers who have employed through the informal sector. The researcher has carried out the sample survey of 50 workers, who live in Kingaon villege, to find out the level of financial literacy and inclusion. The survey indicates increased level of financial literacy and inclusion but still there is lot more that is needed to be done. Key Words: financial literacy, financial inclusion, informal sector, poverty, etc. Introduction: India is a developing country; where large numbers of people are still living in poverty and most of them are illiterate. Hence, financial literacy is required for achieving financial inclusion. Between1995 - 2022, more than four lakh Indian farmers have committed suicide because of indebtedness and non-availability of institutional finance. Even today, a large number of rural and urban poor either have no access to the institutional finance or they do not know that they can access it. Since recent past the government of India is promoting inclusive growth and sustainable development. Here the focus is to increase participation of maximum number of people belonging to various sections of society. One of the instruments of inclusive growth is financial inclusion, to be achieved through increased level of financial literacy and awareness about banks and banking products. Therefore, financial literacy and inclusion needs more attention. The government of India, under the able leadership of Shri.Narendra Modi, correctly identified this and introduced, PM Jan DhanYojana, on 28th August 2014, as a part of its National Mission for Financial Inclusion. As the government has put up lots of efforts to increase financial literacy and financial inclusion, it becomes necessary to check whether the expected level of literacy and inclusion has been achieved or not. Quick Response Code: Website: https://jrdrvb.org/ DOI: 10.5281/zenodo.16885235 Creative Commons (CC BY-NC-SA 4.0) This is an open access journal, and articles are distributed under the terms of the Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International Public License, which allows others to remix, tweak, and build upon the work noncommercially, as long as appropriate credit is given and the new creations ae licensed under the idential terms. Address for correspondence: Dr. Shashikant V. Mundhe,Associate Professor in Economics, Siddharth College of Commerce & Economics, Mumbai How to cite this article: S. V. Mundhe.(2025).Transformation Through Financial Literacy and Inclusion: A Study of Informal Sector Workers in Kingaon Villege. Journal of Research & Development, 17(9(I)),115118 Original Article Journal of Research and Development Peer Reviewed International, Open Access Journal. ISSN : 2230-9578 | Website: https://jrdrvb.org Volume-17, Issue-9(I) | Sept - 2025 116 This will help the government to decide further course of action.The present research work is a sincere attempt to find out level of financial literacy and inclusion amongst those poor workers who have employed through the informal sector. The researcher conducted the sample survey of 50 workers employed through informal sector, who live in Kingaon villege, (Kingaon is a large village located in Ahmadpur Taluka of Latur district, Maharashtra with total 2157 families residing. The Kingaon village has population of 11286 of which 5843 are males while 5443 are females as per Population Census 2011. Kingaon village has lower literacy rate compared to Maharashtra. In 2011, literacy rate of Kingaon village was 76.51 % compared to 82.34 % of Maharashtra. In Kingaon Male literacy stands at 83.89 % while female literacy rate was 68.70 %.), to find out the level of financial literacy and inclusion. The respondents were posed with questions regarding their knowledge of bank accounts, types of bank accounts, use of bank accounts, knowledge of and use of debit cards, credit cards, internet banking and mobile banking, etc.The survey indicates increased level of financial literacy and inclusion, especially after the introduction of Pradhan Mantri Jan DhanYojana (PMJDY), but still the government has to go a long way ahead. The research paper is organized into five parts; namely - Introduction, Objectives and Methodology, Scope of the study, Analysis and recommendations. Objectives And Research Methodology: Objectives: 1) To find out the level of financial literacy among the workers employed through informal sector in Kingaon villege. 2) To know the level of financial inclusion among the workers employed through informal sector in Kingaon villege. 3) To understand out the level of access to/use of digital banking among workers employed through informal sector in Kingaon villege. Research Methodology: The researcher collected data by conducting sample survey of 50 respondents (workers employed through informal sector in Kingaon village located in Ahmadpur Taluka of Latur district, Maharashtra), using questionnaire method. The collected data is tabulated under two tables and analysed using descriptive method. Scope Of the Study: This study is based on sample of 50 workers employed through informal sector and who live in Kingaon villege located in Ahmadpur Taluka of Latur district, Maharashtra. The small sample size is a limitation of this study. However, in the villeges like Kingaon it was not possible to obtain more than 50 respondents within the criteria specified by the study. This study can be expanded to include other categories of people. The researcher himself had conducted similar study about female domestic servants from Kamothe and Naupada villege (TalukaPanvel, Dist. Raigad, Maharashtra) during the period Dec. 2016 – Jan. 2017. The same type of study could be conducted in other villages or cities too. The type of questions could be expanded to know about their membership of any cooperative credit society or any SHGs and their knowledge about stock markets, mutual funds, various other financial instruments, etc. Hypotheses have not been included in the study because this is a working paper and results from this initial study may be used to have a more extensive study in the future. Analysis Of the Questionaire: The government of India has introduced several schemes to increase the level of financial literacy and inclusion. The central government, under the leadership of Shri.Narendra Modi, has started, PM Jan Dhan Yojana, Pradhan Mantri Suraksha Bima Yojana, Pradhan Mantri Jeevan Jyoti BimaYojana (for life insurance) and Atal Pension Yojna (for pension). As the government has put up lots of efforts to increase financial literacy and financial inclusion, it becomes necessary to check whether the expected level of literacy and inclusion has been achieved or not. This will help the government to decide further course of action.With this purpose, the researcher conducted the sample survey of 50 workers employed through informal sector and who live in Kingaon villege located in Ahmadpur Taluka of Latur district, Maharashtra. The responses gathered have been collated and tabulated in the form of following two tables; Table (1): Knowledge and use of various bank accounts. (May-June 2025) BANK ACCOUNT TYPE OF BANK ACCOUNT SAVINGS FIXED RECURRENT JOINT JAN DHAN DON’T KNOW KNOWLEDGE OF 50 50 03 17 25 50 NIL USED BY SELF 43 43 03 17 25 43 - USED BY FAMILY 07 07 Nil NIL NIL 07 - Journal of Research and Development Peer Reviewed International, Open Access Journal. ISSN : 2230-9578 | Website: https://jrdrvb.org Volume-17, Issue-9(I) | Sept - 2025 117 Table (2): Knowledge and use of various bank products (May-June 2025) DEBIT CARDS CREDIT CARDS INTERNET BANKING KNOWLEDGE OF 50 11 41 USED BY SELF 37 NIL 27 USED BY FAMILY 13 NIL 14 The research study has used the questionnaire method to find out the knowledge and the use of bank accounts and various other bank products or facilities. Scope of the study was restricted to the workers employed through informal sector and who live in Kingaon villege, hence 50 such respondents were interviewed. Findings of this research study are as follows. Out of the total of 50 respondents all are found to have the knowledge of banking and bank accounts. But most of them were unaware of the types of bank account. All 50 respondents have the knowledge of savings account (Bachat Khata), 06 percent of them have the knowledge of fixed deposits, 34 percent and 50 percent of them knew about the recurrent and joint accounts respectively and all (100 percent) respondents are aware of Jan Dhan accounts. Around 86 percent have actually been using either of the bank accounts (deposits). In other words, all are found to have the knowledge of banking but when it comes to use, only 86 percent of them actually use it on their own and remaining 14 percent use with the help of their family members mostly their literate children. The percentage of respondents using savings, fixed, recurrent, joint and Jan Dhan accounts is found to be around 86, 06, 34, 50 and 86 respectively. It underlines the fact that large percentage of people have actually been covered by financial services and hence the financial inclusion has been progressing as per expectations. The researcher has also gathered the data about the use of various bank accounts or deposits by other family members (mostly their literate children) of the respondents. The data in the table shows that the percentage of other family members using the bank account or deposits comes to around 14. Around 06 and 34 percent of respondents are found to be using fixed and recurrent deposits on their own without the help of their family members. Nearly 50 percent of total respondents are using the joint accounts along with their female partners. Most of the joint accounts are in addition to their saving accounts. They have mostly using these joint accounts to reap the benefits of various government schemes. The economy is moving toward the cashless system. Therefore it becomes important to know whether the banking instruments or facilities required for cashless system have actually reached in the hands of people or not. The researcher has collected the data about the knowledge and use of debit cards, credit cards, internet banking and mobile banking. Almost all the respondents are found to have the knowledge of debit cards (popularly known as ATM cards).Approximately 22, 06 and 82 percent of the total respondents are found to have the knowledge of credit cards, internet banking and mobile banking respectively. But merely knowing the instrument or facility does not indicate the financial inclusion. Here, one should check the actual use of the facilitators (instruments) of cashless economy. Nearly, 74 percent of the total respondents are found to be actually using the debit cards. But with few exceptions, most of them have reported that they do not require assistance to use the cards. This highlights the healthy literacy rate of male in Kingaon villege which was around 83.89 percent as per the census of 2011. Around 26 percent of the respondents have reported that the debit cards are used by their literate children. Very few respondents have reported to have the knowledge of Credit Cards but none of them are found to use them. There are several reasons for this, like; their income levels do not match for credit card facilities to be made available to them, most of them are illiterate, etc. Interestingly, around 82 percent of respondents claimed that they have the knowledge of internet banking and nearly 54 percent of them can use the facility of internet banking (make and receive payments through UPI Apps) on their own. This is a healthy sign for the economy dreaming for cashless transactions. Recommendations: Considering that this study is indicative of the overall picture in the rural parts of the country, the researcher can make following recommendations: 1) Now we are living in the 21st century, yet a considerable number of people are found to be illiterate. Hence, financial literacy and inclusion is possible only if government implements literacy programme truthfully. Journal of Research and Development Peer Reviewed International, Open Access Journal. ISSN : 2230-9578 | Website: https://jrdrvb.org Volume-17, Issue-9(I) | Sept - 2025 118 2) The banks, at least public sector banks, should appoint at least one bank representative per bank branch, who will approach the poor and illiterate customers and introduce them with the various bank deposits, especially recurrent deposits and fixed deposits. 3) Customers visiting the bank branches, should be informed about the various benefits of using debit cards. Customers should also be given some kind of training for the use of debit cards. 4) Bank employees should organize workshops or training sessions to educate poor and illiterate customers about financial frauds and cyber security. 5) The bank employees should work in two shifts and branches should be kept functional since early morning till late evening because most of the informal sector workers being daily wage earners hence they find it difficult to visit bank branches during the day time. References: 1) Baluja G. (2016). Financial literacy among women in India: A review. Pacific Business Review International, 9(4), 82-88. 2) Carpena F, Cole SA, Shapiro J, etal. (2011) Unpacking the causal chain of financial literacy. World Bank Policy Research, Working Paper no. 5798. 3) K.G. Karmakar, G.D. Banerjee and N.P. Mohapatra. Towards Financial Inclusion in India. Sage Publications, 2011 4) Singh B. P., Kumari A., Sharma T., & Malhotra A. (2021). Financial Inclusion, Pradhan Mantri Jan Dhan Yojana Scheme and economic growth: Evidence from Indian States. 5) Department of Finance, Gitam Institute of Management, Gitam University. Financial Inclusion in India: Challenges and Strategies. 1st ed., New Delhi: Excel Books, 2013. 6) J.M. Mohan. “Corporate Financial Inclusion Plan in India, An inclusive growth approachAn Empirical Study.” The Management Account, pp. 897, Oct. 2011. 7) https://www.census2011.co.in/data/village/560299-kingaon-maharashtra.html