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BFSI Chronicle, 11 Edition September 2022
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of the distortion created by survivorship bias and the from 300 million in 2021. 5G will alone contribute
inherent psychological comfort of storytelling and 80% to devices that will be sold in the next five years
believing, we the people, fall for them. − that is 840 million 5G smartphones (Deloitte, 2022).

Technology and Internet- the disruptive forces Further, several rounds of studies spread across
to reckon with decades have highlighted the precariously low finan-
The internet has been and continues to be a disrup- cial literacy in India. Two such recent studies of 2017
tive force impacting distribution and consumption (Günther & Ghosh, 2018) and 2019 (RBI, 2021) have
channels for media. With improved networks, better concluded that approx. 74% of the Indian population
access to internet, multimedia service-capable mobile is financially illiterate and lacks sufficient financial
devices and application development ecosystem, competencies and lags in terms of long-term financial
more and more media consumption is happening behaviour and attitude. Add to this the fact, says a
on digital platforms. As a medium, the internet is 2017 RBI study (Ramadorai, 2017), that Indians have
a brilliantly efficient conduit for channelizing the very low financial savings, negligible emergency
information from those who have it to those who do funds and little savings earmarked for retirement
not and need it the most. years.

Moreover, the proliferation of the low-cost internet The above facts portend a perilous situation.
and cheap handheld mobile technology has brought A largely illiterate (financially, at least) population, low
about the breakdown of the clout of the gatekeepers on financial savings, freely accessing the capsulized
of traditional media (read- large media houses owning and narrative based information on the smartphones
print & TV) and the unprecedent upsurge of the inde- for “Get rich quick schemes”, “High returns”, “Best
pendent creator economy (Dukurs, 2022) which, has stocks to invest” etc. The algorithms, the backbone
now spread its wings into the personal finance sector of social media, slowly start “defining” the user and
as well. Influencers and digital content creators with populating his/her social media feed with success
huge fan following now share their views, opinions stories (survivor bias) of investing with scant regard
and recommendations in easily accessible, bits of to the deeply personal notions of risk & return. In
animation, audio and motion video, weaved into a fact, Twitter in one of its recently released trend
believable & convincing narrative for easy consump- reports highlighted that there has been a 185% jump
tion and sharing across social media platforms. in discussions around finance in the last two years
and the surge of “finfluencers” i.e. financial influenc-
But, isn’t that great? Should India be worried? ers (Khosla, 2022). For many who are younger and

less experienced, such investing ratchets the old
Yes. Very much so. idea of a stock tip up to a whole new level of virality
and financial risk. Unless one is cognitively armed,
In the Indian context, of the consumers of digital this DIY (Do It Yourself) method of investing based
content, approx. 75% belong to the age group of less on influencer endorsements, ideas and approvals
than 35 years. More than half of the app users in India can fuel speculation and cause irretrievable loss of
are aged between 18 and 24 years and a further 29% finances.
between 25 and 35 (Deloitte, 2016). According to one
analysis, India is expected to reach 1 billion smart- What lies in store?
phones by 2026 from 750 million currently, which is A desire to learn from the successful is a natural
75% of the total base compared with 70% as on date. instinct, but this can backfire if we don’t take into
According to Deloitte’s analysis, demand for smart- account ‘survivorship bias’. In simple terms, this
phones in India is expected to increase at a CAGR of comes about when we select only the ‘survivors’
6%, to reach about 400 million smartphones in 2026 – those that outperformed the rest– and come to

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