SINCE the global financial crisis and economic recession in 2008, worldwide global policy makers have strived to focus on minimising financial hazard and balancing financial system. Over the last decade, the intensified financial deepening has also augmented in Bangladesh. The financial regulatory agencies in Bangladesh have devised policies for fostering and advancing financial inclusion and promoting new investment opportunities all over the country, especially for the marginal rural micro enterprises without adopting any viable policy for ensuring nationwide financial literacy. The national policy of Bangladesh has prioritised financial inclusion. The Bangladesh Bank is responsible for the advancement and immediate adoption of financial inclusion programmes. The Bangladesh Bank has taken multifarious policy initiatives. They include vulnerable group credit programmes, opening rural bank branches, introducing school banking and street child bank account opening. But it lagged behind in fostering financial literacy. As a nation we need to have a national policy to promote financial literacy with specific time bound goals. Our financial market mechanism has remained incapacitated because of lack of proper access to financial information. Information flow is asymmetric between consumers and financial service providers (banks and micro finance institutions). Consequently, consumers make flawed investment decisions. Especially in rural regions, consumers are not well informed about the financial services available for them. According to the Organisation for Economic Cooperation and Development, the term ‘financial literacy’ refers to the integration of understandable awareness of financial products and concepts by consumers and investors, and their capacity to speculate financial risks and opportunities, so that they can make well informed financial decisions. Financially literate individuals are well equipped to formulate their own household budgets and distribute financial resources efficiently, plan for savings, and devise crucial investment decisions. Except for a brief policy statement regarding financial literacy in the Bangladesh bank website, there is not any initiative to address this concern. According to the website, people of Bangladesh have proper access to all financial goods and services. In addition, it encourages all the scheduled financial organisations, especially all banks to develop and formulate purposeful financial products for all, precisely for the social excluded people. As part of financial inclusion strategy, a good number of financial products and services have been formulated such as Tk 10 opening balance for rural farmers. All of these financial programmes, as a means of financial inclusion, may have made financial services available for wider public. However, it does not guarantee better understanding of financial system. Employment category, educational background, income level, and occupational activities have been potential determinant factors for measuring financial literacy. White-collar employees, professional individuals, and business entrepreneurs are more likely to have good command in financial system. In 2015, Khalily and Miah carried out an intensive empirical study on financial literacy in Bangladesh. The survey took three factors into consideration to measure the financial literacy: bank-related financial knowledge, basic mathematical knowledge, and an overall understanding of inflation and discounting. The survey reported that the mean score was 15.2 out of 38. Based on empirical evidence it can be perceived that financial literacy is negatively related to age and positively related to educational level. In our rural areas, women, workers, older people and other groups have been evidently vulnerable to financial inclusion. Therefore, an inclusive policy needs to be immediately drafted to make a change in the financial literacy situation in Bangladesh. It is high time for our financial regulatory authorities like the Bangladesh Bank and the Microcredit Regulatory Authority to take on the task of formulating this policy with reliable analytical tools to measure and monitor the impact of financial literacy programmes.
