Financial analysis
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Only 24% Indians are financially literate, revealed the S&P Ratings Services' "Global Financial Literacy Survey", which interviewed more than 1.5 lakh adults in over 140 countries on topics of numeracy, compound interest, risk diversification and inflation.

India's result is in line with BRICS', where the average is 28%. However, India falls in the lower end and fares lesser than other BRICS countries at 24%. Among the BRICS countries, South Africa has the highest financial literacy rate at 42%.

Among 60% of richest households in India, only 26% are financially literate whereas 20% of the poorest 40% households are financially literate, indicating a lesser knowledge gap in the bottom 40% of the country.

"Poor adults are 21% points less likely than richer adults to correctly answer the compound interest topic correctly. With regard to interest, the gap is 11% points," the survey said.

In India, education is related to the level of financial literacy, with 38% adults who had tertiary education, 30% with secondary and 18% with primary education being able to answer questions on all four topics.

"Research increasingly shows saving money is better for development than credit. Yet, just 14% of adults in India save at a formal financial institution — and their weak financial skills raise questions as to whether they're getting the most out of their money," said the survey.

The survey also revealed that the richest 50% of the countries have higher financial literacy. However, for countries with per-capita GDP of $12,000 or less, financial know-how is related less to income level and more to national-level policies on education and awareness.

"People who aren't financially literate — especially women and the poor — face barriers," said McGrawHill Financial, a financial information and analytics company.

The financial company, which was part of the makeup of the research, said only one in three adults around the world is financially literate, adding that women face extra hurdles in joining financial services, and that the gender gap in financial literacy in the US is 10%.