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“A Study on Financial Awareness and Literacy among Rural Youth in

Hassan District”

Dr. Venkatesh. C. K.

Associate Professor, Government First Grade College for Women, Holenarasipura, Hassan District.

DOI:

https://doi.org/10.51583/IJLTEMAS.2026.1505000117

Received: 27 April 2025; Accepted: 02 May 2026; Published: 23 May 2026

ABSTRACT

India is heading towards becoming the third largest economy in the world. For this to become a reality both

Urban and Rural Economies should contribute in augmenting the economic stability. Inclusive growth especially

with respect to the rural areas where financial literacy rates are limited. The present study titled “A Study on

Financial Awareness and Literacy among Rural Youth in Hassan District” aims to examine the level of financial

awareness among the rural youth in Hassan District and to understand how it influences their financial decision

making.

There are Eight Taluks in Hassan District, namely, Hassan, Arakalagood, Holenarasipura, Arsikere, Belur, Alur,

Sakaleshapura and Channarayapatna. The Researcher has derived the information from all these taluks by

serving a structured questionnaire. The study focuses on rural youth in Hassan District, which is rich in coffee,

arcanut and spices. This segment of population has a very high potential to contribute to the economic growth

of the country. However, lack of awareness about basic financial instruments, saving plans, investment

opportunities, and credit management is kind of hindrance in making India digital. Due to this reason rural folks

are not able to make calculated and informed financial decisions. This study is based on the data derived from a

structured questionnaire administered to a selected sample of rural youth in Hassan District. The study

emphasizes on rural youth in Hassan District of Karnataka, who represent a significant segment in the

demography and they have all the potential to contribute to the overall economic development of the country.

The current study adopts an empirical approach by collecting the primary data from a structured questionnaire

which is distributed among a selected sample of rural youth.

The objectives of the current study includes assessing the level of financial literacy of rural youth, analysing

awareness about the banking services and government schemes, identifying the factors influencing financial

behaviour of rural youth. It also evaluates the role of digital financial tools such as mobile banking, UPI services

in enhancing financial inclusion. All this is evaluated using percentage analysis, mean scores, correlation

techniques.

The findings of the study reveal that there is moderate levels of financial awareness among the rural youth in

Hassan District, the youth has significant lower levels of understanding with respect to investment practices and

advanced financial literacy. The study highlights the need for financial education programs, awareness

campaigns and various other policy interventions to improve financial literacy and promote responsible financial

behaviour.

Eventually the study concludes that educating rural youth with respect to financial literacy is essential for

achieving financial inclusion and sustainable development. The study also provides valuable insights for policy

makers, educators and financial instruments to design effective strategies aimed at empowering rural youth with

essential financial skills.

Keywords: Financial Inclusion, Financial Instruments, Sustainable Development, Youth Empowerment, UPI

Services, Digital Banking, Mobile Banking, Online Banking.

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INTRODUCTION

Financial Awareness and Literacy is considered to be prime skill in today’s competitive economic environment.

Financial Literacy relates itself to the study of an individual’s ability to understand various financial concepts

such as, savings, budgeting, investing, borrowing and managing money to grow effectively. Financial Literacy

helps the individual’s to make a prudent decision so as to make investments effective. It leads to overall

improvement of financial wellbeing of an individual and in turn it also augments the effectiveness of the

economy.

India is considered to be a developing economy with rapid changes taking place in the financial system regime.

Digital Banking, Financial Inclusion Programs of the Government, Technological Advancements in Financial

Engineering has led into the overall development of Financial Literacy. Rural areas still lag behind when

compared to the urban areas in terms of financial literacy and awareness. Rural economy is considered to be

wrapped up under the pillow of a farmer. Rural youth still struggle to understand financial system and its

functioning in particular. This population in rural areas forms a significant pie when it comes to the management

of funds. They rural youth is considered to be future earners and contributors to the overall economic

development of the country.

In spite of various efforts taken by the government and financial institutions various financial inclusion programs

in the rural areas are not fetching the desired results. The reasons for such failure may be identified as limited

access to financial education, bad banking infrastructure, and lower socio-economic conditions. Lack of

exposure to financial system has to be replaced with financial literacy programs.

Hassan District in Karnataka, is considered to be agriculture based economy with most of the livelihoods are

dependent on agro based economy. The current study explores this economy with specific reference to the

adoption of financial literacy. Financial awareness among younger population is assessed and recorded. The

government policies are to be based on such kind of studies which empowers the rural sector. Governments both

at state and centre can design effective policies and educational programs that can enhance financial literacy and

financial well-being of rural folks. This in turn will result in better economic growth and development.

Therefore, the current study emphasizes on understanding the financial awareness and literacy levels among the

rural youth of Hassan District. The study explores the factors affecting financial literacy and also suggests

effective measures to improve financial prowess of rural youth.

REVIEW OF LITERATURE

Kapoor, G. T., Gupta and Dhawan (2023) conducted a study on 154 respondents in Lucknow to examine

consumer preferences and expectations in online shopping. The major findings indicate that convenience,

variety, and easy access to internet services are key drivers. Trust and satisfaction also play a substantial role in

influencing consumer preferences.

Rani and Siwach (2023) conducted a comprehensive review of financial literacy in India using secondary data.

The study found that financial literacy levels are generally low to moderate across different demographic groups,

including youth. It emphasized the need for policy interventions to improve financial knowledge and decision-

making abilities.

Czech et al. (2023) examined financial literacy challenges among rural populations across seven European

countries using focus groups and interviews. The study revealed low awareness of financial fraud, lack of

budgeting skills, and a strong need for education in savings and risk management.

Mohta and Shunmugasundaram (2023) studied financial literacy and risk behaviour among 318 millennial in

Delhi NCR. The findings showed that higher financial literacy significantly improves investment decisions and

risk-handling capacity among youth.

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Kumar and Lucky (2026) conducted an empirical study on financial literacy among youth in India. The study

highlighted that digital banking and cashless transactions have increased the importance of financial literacy as

a life skill among young individuals.

Saritha, Nasar and Thamam (2026) studied financial literacy and saving habits of rural youth in Nenmeni

Panchayat. The study found that rural youth have limited knowledge of financial products, and improving

awareness can significantly enhance savings behaviour and financial stability.

Jayanthi and Rau (2019) analysed determinants of financial literacy among rural households in South India.

The study concluded that education, income level, and access to financial institutions are key factors influencing

financial literacy levels.

Sharma and Gupta (2022) conducted a study on financial inclusion and literacy in rural India. The findings

revealed that financial literacy plays a crucial role in promoting financial inclusion and improving economic

well-being among rural populations.

Singh and Kumar (2021) examined financial awareness among rural youth in Uttar Pradesh. The study found

that lack of formal education and limited exposure to banking services are major barriers to financial literacy.

Patel and Desai (2020) studied financial literacy among college students in Gujarat. The results indicated that

students have basic knowledge of banking but lack understanding of investment and insurance products.

Rao and Babu (2019) analysed financial awareness among rural youth in Andhra Pradesh. The study concluded

that awareness programs and government initiatives significantly improve financial knowledge.

Kaur and Kiran (2018) conducted research on financial literacy among youth in Punjab. The findings showed

that financial education positively influences saving and investment behaviour.

Lusardi and Mitchell (2014) studied financial literacy at the global level. The study revealed that financial

illiteracy is widespread and affects financial planning, especially among young people.

OECD (2016) conducted an international survey on financial literacy. The report highlighted that youth and

rural populations generally have lower financial literacy levels compared to urban populations.

Atkinson and Messy (2012) analysed financial literacy across countries and found that low financial awareness

leads to poor financial decisions, especially among young and less-educated individuals.

Research Methodology

Research Type

Descriptive and Analytical

Research Context

Respondents located in Hassan District having at least a Bank Account

in their name.

Research Approach

Quantitative and questionnaire based

Data type

Categorical and Continuous variables

Data collection tools

One Closed Ended Questionnaire for analyzing primary data, Various

Journals and Books

Data Analysis Software

SPSS, MS Excel, MS Word, MS Power Point

Sampling Technique

Systematic Sampling

Sample Size (Primary Data)

120 Respondents

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Statistical Tools

Cross Tabulation, Descriptive Analysis, Cronbach’s Alpha, Correlation

Analysis, Regression Analysis, Chi-square test, T test.

Sampling Unit

Respondents chosen from rural parts of Hassan District

Questionnaire Construction

Questionnaire was constructed keeping in view the Objectives set. It

consists of both Open-Ended and Closed-Ended Questions. The questions

were set based on the concept of simplicity and understandability.

Scope of the Study

Restricted to Hassan District Only

Period of Study

February, March 2026

Limitations of the Study

 Respondents include only rural youth

 No comparison was possible

 Sample Size is too small

 Study was completed in a short period of time

 Reluctance of Respondents

Objectives of the Study

a. To Understand the level of Financial Literacy among Rural Youth in Hassan District

b. To explore the factors impacting Financial Literacy Levels among Rural Youth in Hassan District

c. To examine the Socio-Economic factors impacting the Literacy Levels

d. To Understand the awareness of Banking and Financial Services among rural youth in Hassan District

e. To suggest measures to improve Financial Literacy Levels in rural areas of Hassan District.

Hypotheses of the Study

Hypothesis—1

H0: There is no significant relationship between Education Levels and Financial Literacy

H1: There is significant relationship between Education Levels and Financial Literacy

Hypothesis—2

H0: There is no significant relationship between Income Levels and Financial Literacy

H1: There is significant relationship between Income Levels and Financial Literacy

Hypothesis—3

H0: There is no significant relationship between Male and Female, when it comes to Financial Literacy

H1: There is significant relationship between Male and Female, when it comes to Financial Literacy

Hypothesis—4

H0: Financial Literacy does not depend upon Financial Decision Making among Rural Youth

H1: Financial Literacy influences Financial Decision Making among Rural Youth

Hypothesis—5

H0: There is no significant relationship between access to Banking Services and Financial Literacy

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H1: There is significant relationship between access to Banking Services and Financial Literacy

Analysis and Intepretation

In the current study the collected data has been systematically analysed and interpreted to arrive at concrete

results and insights into financial literacy levels of rural youth in Hassan District. The data for the study is been

systematically collected using structured questionnaire. The responses were coded, classified and tabulated for

statistical analysis. Descriptive and Inferential statistical tools are being used to measure the accuracy, reliability

and the validity of the collected data.

Tables presented below for analysis purpose

Gender Analysis

Gender

No. of Respondents

Percentage

Male

64.16%

Female

35.83%

Total

120

100%

Majority of the respondents are Male which is close to 65% of the selected population. This indicates that a

higher participation of rural Male Youth in the study.

Age Group Analysis

AGE GROUP

REPONDENTS

PERCENTAGE

18-25

31.66%

26-30

18.33%

31-36

50%

Total

120

100%

The majority of respondents in this survey belong to 31 to 36 categories indicating the maturity levels of the

respondents.

Education Level

Respondents

Percentage

SSLC

17.5%

PUC

32.5%

UNDER GRADUATION

43.4%

POST GRADUATION

6.67%

TOTAL

120

100%

43.4% of the population have completed their Under Graduation which indicates moderate levels of education

attainment in the rural areas of Hassan.

Reliability Test (Cronbach’s Aplpha)

Reliability Analysis is been explored in order to check the consistency of the data derived from the

questionnaire items with respect to Financial Literacy.

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Variable

Cronbach’s Alpha

Financial Literacy Scale

0.7422

The Cronbach’s Alpha value is 0.7422 indicating the high reliability of the collected data. Any thing above 7 is

considered to be valid and acceptable. It is been recorded that the questionnaire used for the analysis is

consistent and reliable in terms of statistics.

Descriptive Statistics

Variable

Mean

Std. Deviation

Financial Literacy

3.291

0.952

Income Level

2.654

0.673

Education Level

4.123

0.792

Digital Awareness

3.821

0.227

The Mean Financial Literacy Score is 3.291 which is considered to be moderate and standard deviation values

represent high to moderate variation among the respondents.

Correlation Analysis

VARIABLES

FINANCIAL LITERACY

Education Level

0.2122**

Income Level

0.3812**

Digital Awareness

0.5621**

(** Significant at 5% Level)

There is strong positive correlation between Education and Financial Literacy. Added benefit to this is digital

awareness of the participants. It can be concluded that Education along with Income and Digital Awareness will

increase the Financial Literacy in the Economy.

CHI-Square Test

Testing Hypothesis

 H0: There is no relationship between Education and Financial Literacy

 H1: There exists a significant relationship between Education and Financial Literacy

Value

Result

Chi-Square Value

11.2522

p-value

0.001911

P-value is observed as 0.001911 which is lesser than 0.05, therefore it is interpreted that there is a significant

difference between financial literacy among male and female folks. It is again observed that Male respondents

shown moderately higher financial literacy levels.

One-Way Anova (Education Level Vis-À-Vis Financial Literacy)

SOURCE

F VALUE

p-value

Between Groups

4.987

0.0012

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P-value is observed at 0.0012 which is lesser than 0.05, which indicates that Education Level and Financial

Literacy are interdependent. Higher Education Levels would result in better understanding of financial world.

Regression Analysis

ADJUSTED R

0.6381

0.4992

0.3502

= 0.4992, which means that 49.92% of fluctuations in financial literacy is elaborated by independent

variables. The model is considered to be a good fit.

Co-efficient Table for Analysis

Variable

Beta

T- value

Significance

Education

0.4234

4.418

0.000

Income

0.2351

3.332

0.0021

Digital Awareness

0.3221

5.273

0.0001

Education with 0.4234 has the strongest impact on the digital awareness. Again, it is concluded in the analysis

that Education and Income Levels also significantly influence the financial literacy.

Factor Analysis

FACTOR

Digital Literacy

0.7321

Saving Behaviour

0.7891

Investment Awareness

0.6581

From the above table it is concluded that there are three major factors which will influence the financial literacy,

they are, Digital Knowledge or Literacy, Saving Behaviour of individuals and Investment Awareness.

FINDINGS AND CONCLUSIONS

The current study on financial literacy among rural youth in Hassan district has given tremendous results when

it comes to financial literacy part, moderate number of respondents are aware about various government schemes

and banking structure. The awareness is constantly increasing with programs conducted by government

authorities and the banks. It is also proposed in the concluding note that Hassan University need to start a course

on Investor Awareness and Financial Education in the third Semester for all its Under Graduate Students. The

findings further indicate that Education and Income Levels significantly influence the understanding of financial

instruments and financial system.

As for as the gender is considered Male respondents are predominantly showing higher financial knowledge than

their female counterparts. When it comes to awareness with respect to the investments it is considered to be low

in various rural parts of the Hassan District. Again, it is proved in the statistical analysis that there is a

relationship between Education and Financial Literacy. The Regression Analysis exhibits that there is significant

relationship between Education, Income and Digital Awareness put together this can be considered as Financial

Literacy.

Based on these findings the study suggests that Government and Educational Institutions should take active part

in educating the rural masses with respect to Financial Literacy. The academia should incorporate financial

literacy syllabus in its curriculum and government should conduct different campaigns to educate the rural folks.

There is a need to train the rural youth with respect to the usage of UPI and online banking services. Digital

India movement should focus on this area of strengthening the rural youth with respect to the usage of these

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platforms. Specific focus should be given in educating the rural women and effectively implementing the

schemes such as Prdhan Mantri Jan Dhan Yojana in order to make sure that comprehensive financial inclusion

is carried out among the rural youth.

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