RBI announces model scheme for financial literacy among people | india | Hindustan Times
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RBI announces model scheme for financial literacy among people

india Updated: Feb 04, 2009 22:10 IST

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The Reserve Bank on Wednesday came out with a model scheme for the counselling centres to spread financial literacy among farmers.

Financial Literacy and Credit Counselling Centres (FLCCs) Model Scheme has been formulated after feedback, RBI said in a statement.

"Apart from educating people about financial products, it will also formulate debt restructuring plans for borrowers in distress...FLCCs should not, however, act as investment advice centres for products of any particular bank/banks," it said.

According to the new model FLCCs should not act as investment advice centres or marketing centres for products of any particular bank.

Counsellors may refrain from marketing or providing advice regarding investment in insurance policies, investment in securities, value of securities, purchase or sale of securities, promoting investments only in banks own products, it said.

To ensure that there is no conflict of interest, persons managing the FLCCs should not be staff of the bank, it said.

Explaining the reason for introduction of new model, RBI said with the exception of a few, most of the FLCCs were not performing the intended role and were rather promoting the lead bank's products, providing investment advice.