In the Midst of Digital Economy

Abstract

The financial literacy of urban Indians has been a cause of concern for Reserve Bank, commercial banks, and numerous NGOs and self-help groups. Extant literature has proven that financial illiteracy and poor financial skills lead to evils such as indebtedness leading to bankruptcy filings, poverty, divorce, and depression. Keeping in mind the importance of being able to understand and handle personal finance well by millennials, the authors examined 213 Indian students pursuing a PG course in management in Delhi city. To ascertain the students' level of financial knowledge and examine whether factors like gender, education level, undergraduate area of study, income level, etc., factor analysis is conducted and five independent factors are extracted, explaining 80% of variance. Through the study, five factors determining financial literacy were found—borrowing behavior, investment behavior, financial prudence, transaction behavior, and spending behavior—in Delhi from 2014-2018.