ISR (INDIVIDUAL SOCIAL RESPONSIBILITY)

NILESH SHYAMSUNDER SAWANT.ADMISSION NO . HPGD /JUL 14/2790

SOCIAL CAUSE: FINANCIAL LITERACY FOR WOMEN,YOUNG AND COLLEGE STUDENTS

NAME OF THE NGO: “SANCHAYAN”

PRIN.L.N. WELINGKAR INSTITUTE OF MANAGEMENT DEVELOPMENT & RESEARCH

1

INDEXSR.NO PARTICULARS PAGE NO 1) INTRODUCTION

a) FINANCIAL LITERACY b) FINANCIAL SYSTEM PARTS

1. GIVING BACK TO THE SOCIETY2. DIFFERENT WAYS TO GIVING NGO’S3. TAX BENEFIT ON DONATIONS4. FINANCIAL INCLUSION5. FINANCIAL LITERACY6.7. NGO (SANCHAYAN)8.9.

2

INTRODUCTION:The ultimate GOAL of increasing financial literacy is to make smart money decisions and improve your financial knowledge. Financial literacy and awareness can help

you take proper decisions on every topic of finance from your expenses, savings, budgeting to using plastic money wisely. Each of these decisions has an impact on your finances overall and hence the ability to make good financial decisions is very important. To help make profitable financial decisions, it is necessary to understand the basic purpose of financial knowledge and investing

However,In terms of overall financial literacy, India is at the bottom among 16 countries in the Asia-pacific region with 59 index points, according to the annual MasterCard’s index for financial literacy. Only Japan fared worse with 57 points.

The survey polled consumers on three aspects—basic money management (50% weight), financial planning (30% weight) and investment (20% weight)—to arrive at the overall financial literacy index. On individual parameters, India scored 50 index points in basic money management, which was lowest among 16 countries.

The report states that for Indians, “the lack of ability to keep up with bills, set money aside for big item purchases and to pay off credit cards fully could be due to a lack of surplus cash, resulting from the fact that income levels are not high enough to cover expenses” Financial Services giant VISA, Indians emerged as one of the least financially literate among 28 countries. Some of the reasons why Indians ranked low in this reports was the lack of household budgets, lack of money management discussions with family, financial education and overall understanding of money management basics.

3

Indian families discuss money matters including budgeting, saving and spending habits with their children just 10 days per year. The reason ? 43%women and 20% men said they did not understand money management well enough to discuss the subject with their children’s.

Another survey on the elderly by HelpAge India indicated that 79%of India’s oldest old are financially dependent on their childrens.This financial dependency was highest in Delhi NCR at 90%, Kolkata at 84% followed by Ahmedabad at 83% and Hyderabad did the best at 40%

Data source : visa

4

FINANCIAL LITERACYFinancial Literacy and Financial Stability are two aspects of Efficient Economy. Financial Literacy enhances the ability to effectively monitoring of financial resources for developing the economic security of a person. Financial stability of economy is based on these terms and currently it is necessary for

developing and developed country. Currently most of countries are adopting various programs for financial education. India is having large population, growing economy with national focus on inclusive growth and an urgent requirement to develop a vibrant and stable financial system. The Reserve Bank Of India, which is the central bank, has been actively participating in the field of eradicating financial literacy and maintain financial stability in the country. RBI has developed various strategies and adopted programs to develop a smooth process of financial literacy. The present study focus on some important aspects which are necessary for financial literacy to effective financial and economic stability. Financial literacy indicates awareness about financial products.

There are large numbers of stakeholders including the central and state Governments, financial regulators, financial institutions, civil society, educationists and others are involved in spreading financial literacy In India the need for financial literacy is getting greater because of the low level of literacy and large section of population which remains out of the formal financial set up.

There are three parts of the financial system:

Financial intermediaries- Banks, insurance companies and other institutional investors that direct funds from those willing to invest or lend to those who want to borrow.

5 Financial market- where lenders and borrowers meet such as money market and capital market.

Financial market infrastructures -through which money and financial assets flow between buyers and sellers such as payment systems and security settlement systems.

There are several widely used definitions of financial literacy and financial stability exists.

After analyzing a host of papers on the subject. Noctor, Stoney and Stradling (1992) introduced, conceptualized and defined the term financial literacy as “the ability to make informed judgments and to take effective decisions regarding the use and management of money”. Anthes (2004) stated that “personal financial literacy is the ability to read, analyze, manage and communicate about the personal financial conditions that affect material well being”.Organisation for Economic Co-operation and Development OECD (2005) defines financial education is “the process by which financial consumers/investors improve their understanding of financial products and concepts and, through information, instruction and/or objective advice, develop the skills and confidence to become more aware of financial risks and opportunities, to make informed choices, to know where to go for help, and to take other effective actions to improve their financialWell-being.”

Ben Bernanke (2011) highlighted the need for continual updating of financial literacy across all age groups because of the dynamic nature of financial products and services as well as the changing needs and circumstances of individuals with time. Puneet Bhushan &Yajulu Medury (2013) suggest that overall financial literacy levels of individuals are not very high. Financial literacy level gets affected by gender, education, income, nature ofEmployment and place of work.

Financial Literacy as a tool for Financial InclusionThe inclusion of the financially and socially excluded disadvantaged needy, underprivileged and poor people of our country, India.Though for centuries we have been in the forefront of the world affairs in the past centuries, maybe because of civil, social and economic vagaries that the country had to

5

suffer resulted in over 65% of the people excluded from any kind of financial inclusion.

Now the question is what exclusion is and what inclusion is? Exclusion broadly can be said of an individual deprived of having any facility to earn an income, safeguard the same, transfer or invest for a further benefit, protect from risks etc. Inclusion is to help him acquire all these facilities.

An adage in our classic language Sanskrit says “Dhanam Moolam Idam Jagat”. Freely translated, this means Money is center of this universe. While dogmatically one can argue on this adage, pragmatically one needs to accept this, as money, which has an immense exchange power, can open almost all doors.

When a major portion of the country’s people cannot open the doors because of financial exclusion, there arises an imminent need to include them and bring them into the mainstream. And to this the first and most important action is to tell them and teach them. This process is called financial literacy.

But the process of financial literacy is not as easy as it sounds. With vast population, different languages and cultures, with illiteracy as a major stumbling block this is indeed a challenge. But we need to accept this challenge and make forays into the bastions of illiteracy to make the people literate and financially literate at that.

The successive governments in India have taken up this task since the early 1950s soon after we attained our independence. Yet, one can say, the momentum really gained after 2005 when Reserve Bank of India has given directions and guidelines towards a more practical financial inclusion pathway of which Financial Literacy combined with technology becomes a major aspect.

Evaluation of Financial literacy 6

In recent years, developed and emerging countries and economies have become increasingly concerned about the level of financial literacy of their citizens. While still few in number, innovative efforts are underway to help microfinance clients and people improve management of their assets by building knowledge of key financial concepts and developing skills to makeInformed financial decisions. The need for financial education is especially salient in light of the current economic situation. Families struggling to high rate of inflation and reductions in household income need to be able to Draw on financial skills such as budgeting, saving, and credit and debt management. In particular, many low- and moderate-income (LMI) families that were already stretched thin before face even greater financial challenges. These households suffer greater income losses (as a proportion of total income) during high rate of inflation in economy and experience slower economic recovery relative to higher-income households. Many of these families lack the basic knowledge and resources required to save and invest, build wealth, and avoid excessive debt; at the same time, many remain outside of the financial mainstream and lack access to important financial products and services. Financial literacy is expected to impart the wherewithal to make ordinary individuals into informed and questioning users of financial services. It is not just about markets and investments, but also about saving pattern, budgeting, financial planning, and basics terms of banking and most importantly, about being “Financially Smart”.

Importance of Financial literacy Financial literacy is a very complex concept and it is very difficult to understand the impact of financial literacy on society. In fact, as a part of society, we are yet to fully recognize the need and potential of financial literacy. The lack of basic knowledge about financial instruments and their risk-return framework is one common instance of financial illiteracy that is widely observed. Retail investors are greedy to get higher return at very short time and most of them do not calculate the associated risk of financial product. Thus, appreciation of various aspects of financial literacy and how it impacts our lives holds the key to prudent financial planning and welfare maximization, both- at the individual level and for the society as a whole.

Financial Inclusion and Consumer Protection focuses on financial literacy which is necessary for ensuring financial stability. Financial literacy has significant relevance for financial inclusion and consumer protection. Without financial literacy, we cannot expect to make major headway in either financial inclusion or consumer protection.

There are two essential element of financial inclusion, one of access and the other of awareness. The acceptance of these two elements varies country to country. For developed countries with widespread financial infrastructure, the access to financial products/services is not a matter of concern. It is more of a financial literacy issue in that market players/consumers are required to be educated about the features of the available financial products/services, including their risks and returns. In developing countries like India, however, the access to products itself is lacking. Therefore, here, both the elements, i.e. access and awareness need to be emphasized, with improving access assuming greater priority.

Financial Literacy and Target PeopleFinancial literacy target each class of people except that who are worked as financial professionals. Actually there is very thin line between financial literacy and illiteracy and it very difficult to choose a financial literate person. So, it should be compulsory for everyone associated with the financial system needs to be financially literate. This includes all users of financial services, be it the financially excluded resource-poor, the lower and middle income groups or the high net worth individuals; the providers of services; and even the policy makers and the regulators. For the resource-poor population, which operates at the margin, vulnerability can be acute due to constant financial pressures. Cash management of household can be daunting under difficult circumstances, with few resources to fall back upon. Financial literacy efforts, in case of such population groups, essentially, involves educating them about the benefits of being part of the formal financial system and managing short term volatility in incomes and meeting unexpected emergencies without getting trapped in unnecessary debt. For the middle and lower-middle income groups that are participating in financial markets as either savers or borrowers or both, i.e. the financially included, financial literacy efforts should aim at enhancing their knowledge about the market and new products/services. For instance, there is a large section of our population that has a bank account but refrains from participating in the capital market on account of lack of knowledge. Financial literacy, in such cases, would focus on creating awareness about the way the capital market functions and also about the fact that the equity market provides relatively higher returns as compared to other investments, over a longer time horizon. Similarly for high net worth individuals, better knowledge about the financial markets, new and innovative products and instruments is important as it helps them in making better use of the available avenues in the financial markets. This knowledge is also useful for fetching greater returns from their investments.

Content of Financial Literacy

It is very necessary to discuss some important content of financial literacy which play a major role to develop sound financial stability in country. Following are the major areas of financial literacy

Transaction of Money

This area includes the awareness of the different forms and purposes of money and handling simple monetary transactions such as everyday payments, spending, value for money, bank cards, checks, bank accounts and currencies. Following task can come under it.

1.Awareness regarding different forms and purposes of money.

2.Recognition of banknotes and coins.

3.Understand the amount money is used to exchange goods and services.

4.Identify different ways to pay for items, in person or via the Internet.

5.Recognise that there are various ways of receiving money from other people and transferring money between people or organizations.

6.Understand that money can be borrowed or lent, and the reasons for paying or receiving interest.

7.Use of cash, cards and other payment methods to purchase items

8.Use of ATM machines to withdraw cash or to get an account balance;

9.Checking transactions listed on a bank statement and note any irregularities.

Risk and Return AnalysisRisk and return is a key area of financial literacy, incorporating the ability to identify ways of managing, balancing and covering risks and an understanding of the potential for financial gains or losses across a range of financial contexts. There are two types of risk, The first relates to financial losses that an individual cannot bear, such as those caused by catastrophic or repeated costs. The second is the risk inherent in financial products, such as credit agreements with variable interest rates, or investment products.

Following area come under it:

1.Recognition of certain financial products (including insurance) and processes (such as saving) used to manage and offset various risks (depending on different needs and circumstances)

2.Applying knowledge of the ways to manage risk including the benefits of diversification and the dangers of default on payment of bills and credit agreements to decisions about limiting the risk to personal capital.

3.various types of investment and savings vehicles, including formal financial products and insurance products, where relevant and

4.various forms of credit, including informal and formal credit, unsecured and secured, rotating and fixed term, and those with fixed or variable interest rates

5.Knowing about and managing risks and rewards associated with life events, the economy and other external factors, such as the potential impact of theft or loss of personal items, job loss, birth or adoption of a child, deteriorating health;

6.fluctuations in interest rates and exchange rates and other market changes. Knowing about the risks and rewards associated with substitutes for financial products in particular such as saving in cash, or buying property, livestock or gold and borrowing from informal lenders.

Financial Literacy and RBI InitiativeThe Reserve Bank of India (RBI) released new guidelines for financial literacy and credit counseling centers after a study showed most of the existing centers were “actually working as institutions of sponsor banks”. RBI said a nationwide survey of 30 centers in 16 states showed

informational material provided by these centers generally pertained to various products of sponsor banks. “Even though 53 per cent of the FLCCs (financial literacy and credit counseling centers) are run by separate trusts/societies formed for the purpose, these are actually working as institutions of sponsor banks due to their dependence for funding and administrative support,” RBI said in a release. “Thus, FLCCs are not in a position to maintain arms-length distance from sponsor banks as envisaged in the model scheme.”RBI found all such centers were located in urban and semi-urban areas and not in rural areas, where most of the financially excluded population resides. Awareness of such centers is low, RBI said, adding they serve mostly walk-in clients and have very few outdoor campaigns. RBI said lead banks of various districts of the country would be told to set up financial literacy centers in each lead district manager’s office. The banks will be given a deadline to set up these centers. This is expected to add more than 630 centers across the country. RBI said banks should consider setting up need-based financial literacy centers in more locations. The rural branches of all scheduled commercial banks will be expected to promote financial literacy. To standardize the information disseminated via such centers, RBI is preparing uniform training and educational modules that would be distributed to all banks. Banks can translate the material into different

languages, with focus on explaining basic banking products such as savings-cum-overdraft account. Financial centers would be expected to maintain full record of the people served.

The onus of monitoring these centers would be on the banks and the state-level bankers’

Therefore, for increasing the level of financial inclusion, the GOI and RBI have taken few actions which include the following: • Nationalization of banks (1969, 1980) • Priority Sector Lending requirements • Establishment of Regional Rural Banks (RRBs) (1975, 1976) • Service area approach (1989) • Self-help group-bank linkage program (1989,1990) The other measures taken by GOI, RBI and National Bank for Agriculture and Rural Development (NABARD) are shown in below table.

Customer Service Centers

Credit Counseling Centers

Aadhar Scheme

The National Agricultural Insurance Scheme

No-frill Account

Know Your Customer

General Credit Card

Project on Processor Cards

Microfinance Development Fund

Role of NGOs, SHGs and MFIs

BF and BC models

Micro Pension Model

Nationwide Electronic Financial Inclusion System

Project Financial Literacy

National Rural Financial Inclusion Plan

Financial Inclusion Fund Project on “e-Grama”

SHG-Post Office Linkage

Financial Inclusion Technology Fund

Separate Plan for Urban Financial Inclusion and Electronic Benefit Transfer Scheme

Financial Literacy through Audio Visual medium - Doordarshan

Support to Cooperative Banks and RRBs for setting up of Financial Literacy Centres

Farmers’ Club Program

Rural Volunteers as Book Writers

Source: RBI, Economic Survey, Government of India, Various Issues.

Role of Post OfficeMultiple initiatives have been undertaken by both GOI and the RBI to tackle the problem of giving the unbanked people an access to financial services. Many of these initiatives were entirely new schemes with little thought about synergy with other schemes existing in the system. The existing extensive network of post offices can be targeted by utilizing it as an alternative banking solution for the unbanked people. In India, there are nearly 1,54,856 post offices as on March 31, 2013, with nearly ninety percent in rural areas (Table 5). State-wise distribution of post offices reveals that a large network in Bihar, Orissa, Madhya Pradesh and Uttar Pradesh can be useful to extend financial inclusion.

Year Rural Urban2009-2010 1,39,182 15,7972010-2011 1,39,040 15,8262011-2012 1,39,086 15,736

2012-2013 1,39,164 15,692Source: India Post (2013).

SANCHAYAN NGOSanchayan is India's 1st social venture dedicated exclusively to Financial Literacy for Youth and Adults.

Sanchayan is an independent & neutral nonprofit social venture that educates and thus empowers the youth and low income adults to take informed decisions with respect to their personal finances. 

Along with the right financial information and guidance, Sanchayan delivers suitable, low-cost financial services to the urban and rural poor. 

Sanchayan works with Governments, Regulators, Financial Institutions, Educational Institutes, Corporate Foundations, Partner NGOs, and other public and private sector organizations to continue the mission of disseminating neutral financial literacy. 

Sanchayan Suraksha Points (SSPs)are one-stop points for the urban poor to access ALL Financial services like Savings, Banking, Insurance, Mediclaim, NPS, etc in an institutional manner.Sanchayan Society  is a registered non-profit organization registered under The Societies Registration Act, 1860 vide registration number S/66874/2009 dated 09/09/09.

 Mission – A Financially Literate India

Vision Financial Literacy : Disseminate financial literacy to Youth and Adults and the

underprivileged sections. Financial Access : Facilitate the inclusion of the underprivileged section into the

mainstream banking and financial services industry.

Financial Security : Spread awareness and knowledge so that the youth and adults are protected from risks.

Financial Advocacy : Work with the government and regulators to provide basic financial products and services for the youth.

Financial Market Deepening : Promote maximum utilization of available financial products and services among the Indian public.

Financial Education : Complement the existing academic curriculum in schools and colleges by addition of financial literacy workshops to create smart future investors.

Primary and secondary classification:As per the International Classification of Nonprofit Organizations (ICNPO).

Education and Research

Other education (Vocational/ technical schools)

Beneficiary group: Adults and Youths

Geographic Focus: Urban and rural

Location: All over India (State: Delhi, Haryana)

Sanchayan NGO registered under societies registration act XXI of 1860. The donation of the trust is eligible for exemption under section 80G under Income Tax Act.

Coming Year Objectives/ GoalsSanchayan NGO has planning to open 5 more Indian states

Open more Sanchayan Suraksha Points (SSPs) - One-stop points for urban poor to access all financial services.

Conduct 200+ financial literacy workshops across India in partnership with partner NGOs

Achievements

Recognized by SEBI as an Investor Association

Recognized by OECD as an 'Affiliate Member'

HOW THEY ARE CREATING AWARENESS IN THE SOCIETY?Increasing migration from villages to cities in search of income and survival is changing the societal & economic landscape of India. Even the policymakers have finally accepted that ‘migration is here to stay’. Migration is escalating the need for

urban income generation, protection, safety, growth and financial security in the long term, so that the family survives and then maintains a standard of living in the city commensurate with what they had in the villages. In the city, the challenges are different, the needs are more and the risks are far greater, leading to a breakdown of societal trust and interdependence. With the recent launch of the ‘Make In India campaign or ‘Swabhimaan Campaign’ by the Central Government in association with the 'Indian Banks Association' (IBA) and the participation of key players such as the Government, Regulators, Financial institutions and Private companies, Financial Inclusion has become the central theme of inclusive growth.

Sanchayan NGO has been initiated with several programs such as Money Smart and Money Suraksha program. Under Money smart program, Financial Education for the privileged as well as disadvantaged youth so that they can learn about money management and grow to become prudent adults, responsible with their family finances.

Sanchayan Society Financial Literacy workshop in Sanskriti School, New Delhi. Topics covered were Global economic crisis, Banking for Beginners, Shares Markets, Credit Cards, etc.

Under Sanchayan Suraksha program, One-Stop Points for the urban poor to access all financial services like savings, banking, insurance, mediclaim, pensions and financial identity, combined with the right advice and financial literacy.

Under Rural Financial Literacy program, Workshops for SHGs, farmers and rural women to assist them in understanding financial products and services and undertaking financial transactions for their long term well being. An independent and neutral view of financial products & services which provide financial security to rural households.

Sanchayan Society Financial Literacy workshop in Uttarakhand

HOW DO THEY PLAN THEIR ACTIVITIES?Sanchayan works with Governments, Regulators, financial institutions, educational institutes, corporate foundations, partner NGO’s, and other public and private sector organizations to make financial literacy in India a reality. Mr. Avik Kedia, Founder of the Sanchayan Society said, “Sanchayan Society has always been at the forefront for financial literacy initiatives amongst the poorest, as this is one section of the society which is generally always left out.

Sanchayan is primarily run by AvikKedia who is a Chartered Accountant and Chidambara, an art historian. AvikKedia has a passion for spreading financial knowledge among the youth which motivates his work at Sanchayan. Chidambara is passionate about the cause of literacy in any form, for the disadvantaged youth,

and is an expert program outreach coordinator. Being a non-finance person, she brings with her a different thinking and outlook.Currently, Sanchayan is building a strong foundation in Delhi region and has started it’s operations in Mumbai and Bangalore. The organization got officially registered on September 9th 2009 and recently got a tax exemption under SEC 80G.

Sanchayan’s purpose is to create a meaningful impact in the development sector, add value to the education system in India through financial education and to enable common individuals to become empowered to make decisions for themselves. It’s vision can be succinctly summed up as “Enhancing income and enabling financial inclusion for the youth, urban migrants and rural populations through a gendered approach to financial literacy using technology”. Sanchayan’s mission is to disseminate informal financial literacy for the underprivileged youth, provide formal financial education for the well to do youth studying in schools and colleges and enable financial security for the low income urban migrants and rural poor by facilitating financial inclusion through financial literacy.

HOW DO THEY WORKING FOR A SOCIAL CAUSE?

The idea for starting Sanchayan came from the need to bring financial education to the youth and individuals who are primarily from non-finance background, but need basic financial literacy to manage their incomes, expenditures and savings. India is a young country with more than 50% of the population below the age of 30 years, and 60% of the urban and rural poor do not have access to banking and other

financial products and services like micro-insurance and affordable credit. Sanchayan aims to target this market size of 70 crore youth and low income families by providing them access to financial products and services and empowering them to undertake everyday financial decisions on their own.

Sanchayan works in three verticals. First is the youth vertical, in which it conducts the Sanchayan “Fun” Financial Literacy program at schools, colleges and informal education centers. Second is the Urban Migrants vertical where the focus is on working with the different communities in Delhi and NCR like Jahangirpuri, Kotla,Mubarakpur, Burari, Nizamuddin,Timarpur, Badarpur and other resettlement colonies, slums and unauthorized zones where the majority of the urban poor live. The third vertical is the rural communities where it works with farmers and SHGs.

Sanchayan started with financial inclusion by opening bank accounts for the marginalized urban poor like rickshawallahs, auto drivers and vegetable vendors. It believes that financial inclusion and financial literacy should go hand in hand for both to succeed. It’s approach is to go to the communities (schools, colleges, villages, slums etc.) and conduct extensive sessions on financial literacy, leading to financial inclusion for the marginalized groups. The concept is new but will gain popularity if the RBI, SEBI, MCA, Banks, Insurance Companies, Stock Exchanges and NGOs working in the allied fields of Financial Inclusion & Literacy came together on a single platform to share knowledge and chart out a national strategy for disseminating financial literacy.

Sanchayan organizes financial literacy workshops in public schools, government schools, and other schools and colleges, non-formal education centers, slums, rehabilitation colonies and rural areas. It always strives to deliver unbiased and neutral financial knowledge in a simplified manner and in the language that the target audience can comprehend. Financial Literacy has different meanings and usefulness for different target groups. For privileged youth studying at posh private schools in Delhi, financial literacy means knowledge about interest charged on credit cards. For the youth studying at the non-formal vocational education centers of one the partner NGOs, financial literacy means knowledge about savings and banking. Topics covered in these workshops can vary from banking, insurance and markets to cash management and collective bargaining concepts for farmers groups. Sanchayan uses innovative content and media like cartoon strips, videos, games and stories on banking, finance, stock markets, investing etc. to promote financial literacy. It deploys dedicated “Financial Literacy Trainers” (FLTs) to conduct the training programs. This in turn creates jobs for housewives and other women seeking flexible assignments and who continue working with Sanchayan.

1. Schools & Colleges:

Sanchayan imparts literacy to teenagers & youth associated with formal as well as non-formal schools, colleges and educational institutes or partner NGOs. The need for financial education for this segment arises due to the following reasons:

• Increased resources with the privileged section of the children and youth leading to irresponsible handling of money.

• Children are losing the culture of savings and are inculcating wasteful consumption habits.

• Need for financial education for the underprivileged so that they can plan for financial security and an independent financial future.

2. Urban Migrant Communities:

In the cities, Sanchayan focus is on working with the different communities in Delhi and NCR like Kotla Mubarakpur, Burari, Nizamuddin,Timarpur, Badarpur, and other resettlement colonies, slums and unauthorized zones where the majority of the urban poor live.

Sanchayan’s work in this areas stems for the need to:

• Create Awareness about various financial products, services and systems like informal savings, lending practices and other financial transactions

• Emphasis on Risks associated with different financial schemes like informal remittance mechanisms, matkas, chit funds, loan sharks, etc which lead to loss of hard-earned savings for the urban poor

• Bringing the marginalized and the excluded into the fold of the mainstream financial services and banking industry

• Indirectly Influencing the use of remittances back home, wherein the urban poor have some a say in the use of remittance money towards education for the children and other productive purposes

• Financial Planning for the urban poor so that they can plan for emergencies and become financially secure in the long run

• Cheaper and Safer ways of undertaking financial transactions

3. Rural Communities:

The Indian Government’s, RBI’s, Banks’ and Financial Institutions’ focus is only on ‘Financial Inclusion’ without first providing adequate ‘Financial

Literacy’ to the millions of rural populations who are excluded from the formal financial system. Whereas Sanchayan’s focus is on making the common citizen financially literate so that he/she can make independent & informed financial decisions and individually undertake the process of becoming included in the formal financial system, thus leading to financial inclusion, thereby achieving the objectives of the Indian Government, Regulators and Financial Institutions. This process of knowledge-sharing is not happening as of now!! Sanchayan seeks to empower the rural masses to be self-reliant and to plan for a financially secure future.

Financial Inclusion

Financial Knowledge

Financial Education

Financial Literacy

GOAL - Explaining practical finance to common man

SANCHAYAN PROGRAMS:Young adult’s INFORMAL education system:

This segment comprises of those young adults who are not part of the formal education system. These less-privileged young adults are staying at homes, orphanages and institutions with various NGOs across the country and some of them are undergoing practical courses like computer courses, knitting and tailoring, electrician, plumbing, beautician courses, etc. Financial literacy programs for these young adults have been tailored to teach them the elementary concepts like earning income, savings and budgeting before moving on to other advanced concepts like investing, entrepreneurship and developing business skills. This segment of the youth is prone to getting involved in various scams and frauds thus exposing them to the risk of financial loss and insecurity. Sanchayan attempts to educate them about right financial choices and pitfalls.

Sanchayan - Room to Read Financial Literacy Program for 100 Girls as part of Entrepreneurship Development Program named 'Udaan'.

Young Adults FORMAL education system:

The need for financial literacy for the young adults from well to-do families arises from the need to bring about a cultural change in the manner in which they handle their money and finances. The objective is to bring about an attitudinal shift in their outlook towards money and encourage them to inculcate good financial habits like savings and budgeting and to create awareness about basic concepts like banking, credit, concept of appreciation and depreciation, financial instruments, markets, economy, etc.

Financial Literacy workshops for students of Seth Anandram Jaipuria School, Ghaziabad, conducted by Sanchayan Society.

Farmers Financial Literacy Program {FFLP} :

Sanchayan has successfully implemented a unique financial literacy program for farmers that seek to empower them about concepts like financial dependence versus self-dependence, budgeting and accounting for agricultural costs and revenues, cash management, savings and investing, market linkages, collective sale and bargaining and other financial agricultural issues. This program is supported by the World Bank as part of the National Agriculture Innovation Project (NAIP).

Explaining the benefits of NPS Lite to the farmers in rural Jaipur

Sanchayan ‘FUN’ Financial Literacy Program for Young Adults :

Program objectives to be financially literate require a few simple steps that include being aware of the power of money and being responsible with money. It includes saving money, spending money, investing money and most importantly making smart all-around decisions. The following are the objectives of the financial literacy program for the youth

Encourage the youth to save and invest from an early age Inculcate the habit of reading newspapers and business magazines, planning for their college and further professional education, assisting future investors to understand and analyze financial news & data Understand the functioning of the Indian economy Awareness about the global economic crisis and its implications for India.

Under this project Sanchayan NGO has segregated in 2 parts. In 1st part Basics of Banking, Pan card ,The importance of savings, different kinds of Investment ,Indian economy and Global Financial crisis .whereas in 2nd part Various Financial

instruments features such as Stock Market, Mutual Funds, Insurance products ,Loans, Deposits , Credit cards ,NSC,KVP ,Gold and ETF’s

Sanchayan Society has conducted Financial Literacy workshop in Sanskriti School, New Delhi .Topics covered: Global economic crisis, Banking for Beginners, Shares and Markets, Cards, etc.

Sanchayan Financial Empowerment Program for underprivileged Youth and Adults:

The targeted groups under this program are Youth, Men and Women from privileged and underprivileged backgrounds.

1)Financial Literacy Awareness2)Financial Inclusion and ActionAccess

3)Financial Empowerment Sustainability Ripple effect

Financial Literacy for rag pickers @ SSP, Ghaziabad in partnership with Chintan ngo — at Indirapuram Ghaziabad.

Financial literacy workshop for underprivileged.

Youth are the future of our country and helping them to build their own future is the least we can do. Financial education for the privileged as well as disadvantaged youth so that they can learn about money management and grow to become prudent adults, responsible with their family finances.

Sanchayan Rural financial Literacy Program:

Men have been the traditional decision makers with regard to money .Will this ever change? Maybe………

Women are being recognized as capable individuals who care for their families and who can manage their households better. In recent years women are take up income generation activities and take the lead in all family matters be it better schooling for children, increased awareness of hygiene and sanitation ,cleaner and safe drinking water.

Sanchayan’s Rural Financial Literacy Programme strengthens women’s role in making decisions that impact the lives of their children’s and their futures.

Other Programs and Initiatives:

a) Information camp for corporates :

Sanchayan has successfully organized Information camp for Genpact’s Blue collar employees at shashtri nagar, Delhi to create awareness about financial literacy and provide services to support staff.

Information Sharing Camp for Genpact employees at Shashtri Nagar office, Delhi 

b) Mutual Fund Funded initiative for urban poor women’s in Delhi:

Sanchayan Society has concluded series of 10 workshops for the urban poor women in Delhi/NCR reaching out to more than directly 500 poor women. All financial topics like savings, banking, pensions, insurance, investments, etc were covered which was funded by DSP BlackRock Mutual Fund.

Delhi, Friday, March 08, 2013: DSP BlackRock Investment Managers Pvt Ltd, one of the premier asset management companies in India, has partnered with “Sanchayan Society” to organize a series of financial literacy workshops to

address financial needs of women in the lower income segment in the Delhi- NCR region.

A series of 10 financial literacy workshops have been organized in economically weaker sections in the Delhi -NCR region including Ghazipur Dairy, Ghazipur Village, Sikandarpur Village and Mandigaon Village between January 17th to March 8th 2013. The objective of conducting these workshops is to educate women from the underprivileged sections of the society and impress upon them the importance of understanding basic financial terminologies, which are critical to the functioning of their day to day lives. Over 500 women from the lower income sections of the society were introduced to the benefits of financial planning & management and also the importance of investing and budgeting. Daily wage earners from slum areas were invited to the workshop and they were familiarized with financial concepts while being introduced to the world of financial planning. Information and concepts like basic information on the benefits of holding a savings bank account, life and general insurance, pan card, Aadhar Card, Fixed deposits, Postal Schemes, difference between a cheque and a demand draft, usage of ATM machine, Pension products, among others were shared with the participants during these workshops.

Sanchayan Society has concluded series of 10 workshops which funded by DSP BlackRock Mutual Fund.

c) Information Sharing Session at Tech Mahindra office:

As a part of other initiative Sanchayan has conducted Information sharing session at Tech Mahindra office, Noida to increase the awareness of financial education in corporate employees.

Information sharing session at Tech Mahindra Ltd.sector 60, Noida

d) Investor Awareness Program with SEBI at Management Institute:

Sanchayan work towards financial literacy recognized by Securities And Exchange Board Of India ( SEBI).SEBI recognized Sanchayan is an Investor Association during the financial year 2011-2012.Sanchayan now India’s Youngest Investor association!!.Sanchayan now works with SEBI to conduct joint financial literacy and Investor awareness program across the country which benefits thousands of youths and adults from all strata of the society .Sanchayan are indeed humbled and proud at the same time to be working with such and esteemed organization like SEBI.

Investor awareness program with SEBI at Jaipuria Institute of Management Studies .

Investor Awareness Program by Sanchayan in association with BSE, for the young nurses and faculty of Rajkumari Amrit Kaur College of Nursing.

e) Youthreach Rural Women's Financial Literacy Program:

Sanchayan has conducted” Youthreach Rural Womens Financial Literacy Program” covering day to day financial management concepts like savings, budgeting, banking, investing, chit funds, direct marketing companies, Loans and interest calculations, etc. FINANCIAL LITERACY - Empowering women to take informed financial decisions every time, each time.

Youth reach Rural Women's Financial Literacy Program

f)Financial Literacy for NGO Prayas :Sanchayan has conducted one of the separate financial literacy workshop for youth undergoing vocational training at NGO Prayas (New Delhi )

Sanchayan conducts financial literacy for NGO Prayas (New Delhi)

SANCHAYAN TIE-UPS:Over the last year Sanchayan have strived to build long-term relations with their partners with the result that now they are seeing repeat orders for Sanchayan programs from their partners. Sanchayan has worked with youth from the following schools, colleges and NGOs:

School Tie-ups:

· Sanskriti School· Bhartiya Vidya Bhavan· G. D. Goenka Public School· The Banyan Tree School, Lodhi Road· The Pinnacle School· Fr. Agnel School· Seth Anandram Jaipuria School· Summer Fields School· Government Girls School· Laxman Public School· Rajkiya Pratibha Vikas Vidyalaya

and many more schools….

NGO/Non-formal Institution tie-ups:

· Institution for the Blind, Amar Colony· Smile Foundation of India· Rasta (NGO), Patparganj· Salaam Balaak Trust – DMRC Arman Children’s Home, Tis Hazari· Salaam Balak Trust – Arushi Girls Home, Gurgaon· Ability Unlimited (NGO)· Society STADD led World Bank Project

Sanchayan’s Revenue Model:aishid

thThe core team of Sanchayan believes in the social enterprise model wherein Sanchayan charges nominal fees from the privileged segment for its programs and uses the funds generated to create financial awareness among the disadvantaged section. This is the rationale for referring to Sanchayan as a social venture rather than as a nonprofit organization.

Sanchayan’s Revenue ModelSince inception in 2009, Sanchayan has charged the private school students for financial literacy workshops and has used the funds for conducting free workshops for the disadvantaged young adults. This model has not yet

Sanchayan Society

Paidworkshops

forprivileged

Youth

Freeworkshops forGovernment

SchoolStudents

Free workshop forUnderprivileged

Women

Free workshopsfor

UnderprivilegedYouthFree workshops

Paidworkshops

for well-todoYoungAdults

Paidworkshops

forSchool

Teachers

been extensively tested and it is a difficult task making the private schools/students to pay for the workshops. Many well-off schools back out when it comes to money. As a policy, Sanchayan does not charge theParticipating NGOs/Non-formal institutions for taking part in the financial literacy programs, but is open to support from these institutions in terms of joint implementation and sharing of program costs.

Sanchayan in News:

Money is not child's playVeenu Sandhu November 13, 2010 Last Updated at 00:38 IST

How to get children to understand the value of money?

At a workshop conducted recently in a leading school in Delhi, students aged 5 to 18 were asked how many of them their own mobile phones had. Almost 90 percent of the hands shot up.

“The remaining 10 percent would also have raised their hands had their teachers not been in the room,” says Chidambara Sagar, co-founder of Sanchayan Society which organized the workshop, one of the many it holds on financial for young adults. This school was no exception. The response of students from well-to-do families is similar at practically every school.

For the growing population of ‘privileged young adults’ in the 12 to 18 age bracket, it seems, money isn’t something that has to be earned, spent with prudence and, even less, saved for a rainy day. It’s not talked about at home or perceived as an issue that deserves thought. The result, Most teenagers find it hard to grasp the value of money   or the importance of using it responsibly.

(Source: Business Standard)

STATUTORY INFORMATIONA. OFFICE ADDRESS: 16, Vikram Vihar Extn., Second Floor, Lajpat Nagar –

Part 4, New Delhi-110024

B. WEBSITE: www.SanchayanSociety.org

C. ESTABLISHMENT September 2009

D. TYPE OF REGISTRATION: The Societies Registration Act XXI of 1860

E. REGISTRATION DETAILS:

Certificate of Incorporation: S/66874/2009

PAN No: AAEAS7767D

Income Tax Exemption details: 12 A : DIT (E)/12A/2010-2011/S-6282/153880 G : DIT (E)/2010-2011/S-6282/1903

F. CONTACT DETAILS:

Contact Person: Chidambara Sagar Mobile No.: +91 – 98105 – 72277 Email: Chidambara@SanchayanSociety.org Contact Address: H-9, Akash Bharti Apartments, Plot No. 24, I.P.Extension, New

Delhi-110092

Government Programs:• RBI – The Reserve Bank of India is quite active in the field of financial literacy in India. RBI has designed comics on money and banking which can be downloaded for free on the website www.rbi.org.in/FinancialEducation. RBI’s main focus remains on financial inclusion and financial literacy is one of the areas which it is trying to spread awareness about. RBI has directed that public and private banks take up the cause of financial inclusion aggressively while not giving the same attention towards financial literacy. Therefore much needs to be achieved by RBI in terms of making financial literacy and education a mass movement in India.

• SEBI – Many investor associations focused on the stock markets are registered with SEBI. SEBI undertakes investor awareness programs through its department of National Institute of Securities Markets (NISM). www.nism.ac.in

• MCA (IEPF) –

The Ministry of Corporate Affairs is spreading financial and investor awareness through the Investor Education and Protection Fund. The focus of MCA is however more geared towards adult programs primarily comprising of investor awareness camps. www.iepf.gov.in

• ICAI, ICSI, ICWAI – These organizations have their own financial literacy and investor awareness programs and also get support from the MCA and other government departments for spreading financial literacy. These institutions are focused on creating investor awareness among the middle income segment and their own member communities, rather than programs for the general public.

• Stock Exchanges –

NSE, BSE, MCX, and others also have programs on investor awareness and regularly release articles and propaganda related to financial literacy. These organizations are not really focused on financial literacy but on increasing the public participation in the stock markets.

STUDY ABOUT FEW OTHER NGOs:There are very few numbers of NGOs and government department working for such kind of special cause . Such NGOs help them to meet their basic financial needs and requirements.

Moneylife Foundation:Moneylife Foundation, launched on 6th February 2010, is a non-profit organization registered with the Charity Commissioner of Mumbai. The Foundation is engaged in spreading financial literacy, consumer awareness and advocacy and works towards safe and fair market practices through workshops, round table meetings, white papers, research, awareness campaigns, grievance redressal, counseling, etc.

Sucheta Dalal, who was awarded a Padma Shri in 2006 and Debashis Basu, (both award-winning journalists with three decades of experience), set up the Foundation in February 2010. So far, the Foundation has over 36,000 members and has conducted over 250 workshops and seminars.

Moneylife Foundation is a Supporter Member of Consumers International, Development Partner of Advocates for International Development and a Member of OECD’s International Network o Financial Education. Moneylife also received the 10th M.R. Pai Memorial Award in September 2014 for outstanding work.

Moneylife Foundation is one of the fastest growing non-governmental organizations in India and one of the foremost organizations involved in spreading financial literacy in India. Apart from advocacy and spreading financial literacy, it also provides the following programs:

Free membership to Moneylife Foundation Automatic basic membership of Moneylife Smart Savers Network (MSSN) Free access to seminars and workshops on financial literacy Free access to Railway Helpline for railway victims Free access to Disha Consulting for financial- and debt-related issues Invitations to attend round-table discussions Access to free reading room of Moneylife Knowledge Center

Swadhaar FinAccess:Swadhaar FinAccess (SFA) is not for profit organization (Est. 2005) based in Mumbai, India aiming for financial inclusion through the imparting of financial education and the facilitation of access to financial services to the urban low-income communities, predominantly through women.

The term Swadhaar means self-support and reflects SFA’s objective of “helping its clients improve their financial circumstances—to achieve self-reliance, to increase their income generating potential and to ensure that they are able to meet their daily consumption needs.” Reducing the vulnerability of the urban poor to usurious moneylenders, increasing their income-generating & saving capacity and bringing their knowledge up to a ‘bankable’ stage are the areas that SFA works on. Once the women reach that stage, SFA helps them open ‘no-frills accounts’ with banks like Citibank, State Bank, Syndicate Bank, etc. So far, 643 such accounts have been opened for the ‘graduates’ of SFA’s training programs.

The tool used by SFA is financial education. Preeti ( Founder) says, “It ensures that women not only gain credit, but also the ability to spend it wisely. Working with the slum communities in Mumbai, we have learnt that indebtedness is not only caused by lack of money but also by lack of knowledge. Women need familiarity with financial concepts, new attitudes about savings, and better skills in money management.”

SFA’s financial education program also serves the networking purpose—absolutely essential in extension learning. Training programs help build solidarity, give them an opportunity to interact and, through a process of collective learning, find solutions to their problems. Preeti says that they choose one working woman per family and the target age group is 25-50 years. So far, all the learners are married women with children—this profile helps spread financial literacy to extended families and the community as well.

Preeti’s forte is designing and developing communication strategy. Each learner is given a diary called ‘paise ki baat—paise kaise bachayen, kaise badhayen…’ (‘money matters—how to save money and multiply it…’). The diary has simple entries for home budgeting. SFA’s trained staff evaluate the learners on their home budgeting and account-keeping tasks that are set out in the diary. Until March 2010, around 1,500 women had completed the course offered through some 80 training programs.

According to an external impact study conducted in 2009, the retention of attendance was as high as 86%. There is no formal examination but a certificate is issued and an identity card is given to enable the women to open a bank account. SFA has its outreach offices at four locations in Mumbai namely Kherwadi, Chembur, Malad and Andheri.

SFA now depends mainly on donations and volunteers; it has tax-exemption under Section 80-G..

Mann Deshi Foundation:The Mann Deshi Foundation serves as the NGO arm of Mann Deshi Mahila Group. Established in 1994, the Foundation works with the Mann Deshi Bank by providing a variety of non-financial services to their clients aimed at improving the quality of life for rural women and their families in India.

Basic Financial Literacy program:

Mann Deshi Mahila Bank Ltd. has made a special effort to bring illiterate women into the formal sector through bank linkage. Mann Deshi has developed a comprehensive program tailored to the needs of the women in rural Maharashtra. The course has been prepared in Marathi and is translated and distributed in all areas of the Business School’s operation.

“Mann Deshi Business School for Rural Women”(MDBS) is a new program of the Mann Deshi Foundation that provides training in technical, financial and marketing skills to women with no formal education and to girls who have dropped out of high school, allowing them to start and improve their own small enterprises. The Mann Deshi Business School for Rural Women helps to make microfinance available to all women by providing not just business capital but also skills, knowledge and motivation. With the support of Mann Deshi Mahila Ltd. Bank, the business school guarantees suitable loan options to its graduates for seed capital to start micro-enterprises. Most courses are offered in a classroom setting located in Vaduj, which opened in December 2006, although some classes are also offered in Mhaswad and in smaller villages through the Mobile Business School. A business school was set up in Satara in September 2010 and in Hubli in May 2010. The courses are designed to provide the skills needed to start and run a successful enterprise in the local market. The levels of the courses range from basic to advanced, to meet the varied needs and skill levels of women. Courses last between two and eight weeks and are offered on at least a two-year rotation, ensuring that the market will be able to absorb new graduates.

A bus has been redesigned/ converted to operate as a mobile classroom which travels from village to village within Maharashtra and Karnataka.

Material:

In the Basic Financial Literacy (BFL) program conducted by the Mann Deshi Mahila Bank, pictures are used more so that semi-literate and illiterate women can also understand it easily. The pedagogy followed by the MBDS is suitable to the target segment.

As on June, 2011, there are 39,970 Women’s Business School graduates. Of these graduates, 60% have started their own businesses. Over 14,452 women have graduated from the Mobile Business School.

The BFL( Basic Financial Literacy )project received funding from Association for India’s Development (AID) Inc., Portland chapter. HSBC is the founding sponsor for the Business School for Rural Women. The British Asian Trust supports Mann Deshi Business School for Rural Women

Mann Deshi Foundation Financial Literacy Workshop reaches low-income women and prepares them to take financial risk.

.What type of donations can Donar make?We often heard… “I am not sure whether my money will reach the beneficiary”. To simplify, the different ways in which NGOs use donations to further their work with the communities they serve. The next time you make a donation, you’ll know where your money is going!

Corpus Donations:  

Probably the least common, but among the most fiscally prudent options you could fund. A donor has to direct the NGO (Trust, Foundation, Society, Section 8 Company) that his/her donation is towards the entity’s corpus. The NGO is not allowed to use the money for operating expenses. The corpus is liquidated only in case the organisation is shutting down.Ideal for: Long-term donors. A donation to the corpus is an investment in an NGO’s future. If you like an NGO and feel they are doing good work, consider a corpus donation. It helps the NGO to sustain itself financially. Many NGOs with large corpuses use the interest earned by investing the corpus funds to finance programmes. Dependence on donors reduces considerably and the NGOs can run their projects without an interruption.

Donations for purchase of Capital Assets:  

When you choose to purchase equipment like a computer, a car, an ambulance or medical equipment. Corporate donors tend to fund capital assets as they feel comfortable seeing a tangible asset being created.Ideal for: Corporate donors, family foundations, institutional donors. It provides a win-win to NGOs and to donors. Many bigger donors are uncomfortable making large donations for programme expenses and prefer to purchase assets that have a long life and are used when implementing a programme.

Donations for Programme Expenses :

 This is the most common form of donation requests. An NGO requests a specific amount (often small-ticket) to support a programme that directly impacts one or more beneficiaries. You may have seen NGOs asking for Rs500 to provide feed a child or Rs1,000 for a scholarship.The amount may represent a bundled cost in delivering the service. Example: an NGO requesting funds for ‘treatment of a child’ could use the amount towards paying the doctor’s fees, purchasing medicines, the NGO’s costs to bring the child to the hospital or any other activity related to that programme. Your donation could function as gap-funding for the amount the NGO lacks, or it may even sponsor the entire expense.Ideal for: Anyone looking to make an immediate impact. Funding requirements here are often urgent, and a lack of funding means that that beneficiary could be left out of a programme. It’s a great way to prop up an organisation’s work.

Donations for specific resource requirements:

 NGOs also turn to donors to help them source the materials they need to provide services to their beneficiaries. This could include buying rice for mid-day meals, medicines for patients under treatment or books for students from underprivileged backgrounds. They could put up the cost of the item itself, and donors can give in multiples of that amount. This does not cover the NGO’s own operational expenses in bringing that service to the people who need it.Ideal for: Anyone who has an affinity for a cause. If you like animals, and feeding animals is particularly close to your heart, buying dog food or pet food will make you feel most connected to the cause.

There you have it! When you look at an NGO request next, you will know what kind of donation they are asking for. It also shows you how far a few hundred rupees that we take for granted in our lives can go in helping someone in need.

There are four ways of giving – physically by working, socially by being responsible (example: conserve water), emotionally through moral support and financially through donations. When a donor engages solely in financial giving, his ego may come into play. The donor tends to talk about his donation, tries to establish a level of one-upmanship with his peers, resulting in insecurity and comparison. The recipient retains his benefit though.

Another way to create greater discipline is to link giving to special days like birthdays, anniversaries and festive occasions. You could make a start by ensuring that you donate the equivalent of the amount you spend on yourself. During Diwali, for example, you could total the amount you spend on sweets, crackers, new clothes and gifts and give an equal amount to an NGO.

How do you choose a good NGO to support?You need to look at the balance sheet as well as understand the nature of work being done by the NGO. You could look at the financial analysis that HelpYourNGO presents on NGOs or any other NGO link.

Recommendation:Scale, scope and sustainability of Financial Literacy projects are highly fund dependent. Sanchayan follows a co-contributory model to ease scaling up and improve involvement of the trainees. The NGO tried a paid model for Financial Education workshops at schools and colleges but the model has not been successful so far. The NGO is looking out for funders to scale-up their projects to newer areas. Apart from that I would like to recommend that as “Sanchayan” is engaged in social activities in Delhi and Haryana but they will start their initiatives and programs in other cities also. With help of new technologies and new ideas.

For the purpose of the study data has been collected various sources and mainly secondary data has examined for preparation of conclusions, findings and recommendations. The design of research study is exploratory. Data is collected from various sources such as open source websites, journals,Newspapers etc. different finance websites are also being studied to collect the required data.

Research Document Journal of Finance, Accounting and Management (July 2014)

Bibliography

https://www.personalfn.com

https://www.rbi.org.in

http://www.indiapost.gov.in

www.sanchayansociety.org

http://www.global1.youth-leader.org

http://www.business-standard.com

http://www.m-cril.com

http://foundation.moneylife.in

http://www.manndeshifoundation.org

https://helpyourngo.com