Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/189967 
Year of Publication: 
2018
Series/Report no.: 
RBI Working Paper Series No. 06/2018
Version Description: 
Revised Version
Publisher: 
Reserve Bank of India, Department of Economic and Policy Research, Mumbai
Abstract: 
Financial capability of an individual is the ability to use and manage financial products for current and future financial needs with adequate financial knowledge. This paper examines financial capability on four dimensionsfinancial management to meet current needs, future financial planning, financial products management, and financial knowledge using a sample of street vendors in Bhubaneswar, India. A financial capability index for each individual in the sample has been calculated in a manner that satisfies monotonicity, anonymity, normalisation, uniformity, shortfall sensitivity and hiatus sensitivity to level axioms. We find that education, age, business experience, and daily turnover significantly affect the financial capability of an individual. Moreover, street vendors in regions with higher number of bank branches are found to have significantly higher financial capability.
Subjects: 
Financial capability
financial literacy
financial inclusion
JEL: 
O18
R58
O20
Document Type: 
Working Paper

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