Financial studies set to become part of school curriculum

India's school curriculum is set to get a serious make-over with the inclusion of financial education.

The Securities and Exchange Board of India (SEBI) and the SEBI-led National Institute of Securities Market (NISM) have embarked on developing course material on financial education for high-school students.

NISM has started designing the course modules for school, which would include topics such as savings, investments, banking, financial planning and other subjects.

The subject is likely to be introduced in schools over the next one to two years, adding that once the resource material is ready and NISM will also train school teachers.

Meanwhile, the Central Board of Secondary Education (CBSE) has agreed to incorporate financial education as part of school syllabus and it has appointed a committee in this regard.

SEBI officials said that they would like to make it a part of the regular school curriculum, making it necessary for every student to study the subject.

What is Financial Literacy?

Financial literacy is the ability to understand finance. More specifically, it refers to the set of skills and knowledge that allows an individual to make informed and effective decisions through their understanding of finances. Raising interest in personal finance is now a focus of state-run programs in countries including Australia, Japan, the United States and the UK.

The Organization for Economic Co-operation and Development (OECD) started an inter-governmental project in 2003 with the objective of providing ways to improve financial education and literacy standards through the development of common financial literacy principles. In March 2008, the OECD launched the International Gateway for Financial Education, which serves as a clearinghouse for financial education programs, information and research worldwide. In the UK, the alternative term “financial capability” is used by the state and its agencies: the Financial Services Authority (FSA) in the UK started a national strategy on financial capability in 2003.