Impact of Financial Literacy on Financial Capability: Evidence from Urban Working Women in Rajasthan

Abstract

Financial knowledge and access to basic financial services impact the financial stability of households and may have long-term implications on financial well-being. In this particular research work, impact of financial literacy on financial capability of urban working-women is analysed in selected districts of Rajasthan state. In all 530 urban working women in state and private organization as well as self-employed and women entrepreneurs have shared their opinion regarding the level of finacial literacy from the perspective of Financial knowledge, financial behaviour and finacial attitude on financial capability during primary survey. Multi-stage sampling is used to conduct the survey. Factor analysis, correlation and regression analysis tools were used for data analysis. This was found that financial behaviour and financial attitude impact financial decision making the most in urban working women however impact of financial literacy upon financial decision-making by urban working women was found significant. Overall the results indicated that financial knowledge and skills (FK), financial Attitude (FA), financial Behaviour (FB) have strong association with financial capability (FC) of urban working women with different demographic profiles.

Keywords: Financial capability, financial attitude, Financial Literacy, financial decision, Financial behaviour