FINANCIAL LITERACY
Investment bank Goldman Sachs has forecasted that India’s household savings will generate about US$9.5 trillion of inflows into financial assets over the next decade.
“You are helping build capital formation at the macro level,” said Jain.
“At the micro level, you are starting to build this habit of regular savings, and building a corpus over time that actually helps beat inflation.”
But some experts cautioned against exposing low-income savers to the volatility of the stock market — especially in a country where financial literacy remains low.
Low levels of financial awareness mean it will take time and effort for these micro-investment plans to gain traction among the masses, they noted.
Financial planning platform Airpay Money is looking to address this gap.
It is working with its merchants across smaller cities, towns and villages to equip them with the skills needed to promote these micro-investment plans to potential investors.
Kumar Binit, CEO of Airpay Money, said the process is “not a quick-fix solution” and will “take a little more time”.
He noted that educating people and reaching deeper into smaller but fast-growing urban centres remains challenging, as many are “still used to savings and gold or fixed deposits”.
For Chauhan, investing in a mutual fund was a bold step – one driven by hope for a better future and stronger returns on his hard-earned money.
Experts say that for many others, it will take much more persuasion and financial education before they are ready to change their saving habits.