Presentation on theme: "OECD/INFE toolkit to measure financial literacy and inclusion"— Presentation transcript:
1 OECD/INFE toolkit to measure financial literacy and inclusion Adele Atkinson, PhDOECDWith the support of the Russian/World Bank/OECD Trust Fund
2 Outline and overview of toolkit Toolkit developmentOutcomesFuture plansOverviewSet of good practice questionsSupplementary question setGuidance on undertaking asurvey
3 Questionnaire development process OECD/INFE definition: “A combination of awareness, knowledge, skill, attitude and behaviour necessary to make sound financial decisions and ultimately achieve individual financial wellbeing”Survey of INFE members: identify questions, survey approaches, analysis methodsDevelop, discuss and refine a set of core questionsUndertake a large- scale exercise to measure financial literacyFinalise the questionnaire and make available for widespread useReview of available national surveys to identify typical content, suitable questions & appropriate method for data collection and analysisConsultation with experts and country representatives to choose the most important questions and the best combination of questionsCreation and fine-tuning of questionnaireInvitation to INFE members to pilot: accepted by 14Creation of a master dataset and preliminary analysis in order to develop scoringDetailed analysis and reporting; finalising2008/ / /12
4 Existing surveys were scrutinised to identify good-practices and common themes & approaches A range of national surveys on related topics were examined from around the world- including surveys from Australia, Austria, Canada, Iceland, Ireland, Indonesia, Italy, Malaysia, Netherlands, Singapore , the UK and USA.
5 A questionnaire has been developed based on existing approaches and good-practice questions BehaviourKeeping track of moneyMaking ends meetChoosing and using productsShort and long term planningKnowledgeSimple and compound interestInflation- time value of moneyRisk and returnRisk diversificationAttitudesPropensity to save vs spendTime preference (present vs future)Risk preference (explanatory variable)Financial inclusionAwareness of productsHolding and using productsProduct choiceSocio-demographic informationAgeGenderEducationWorkIncomeAttitude exampleI find it more satisfying to spend money than to save it for the long termMoney is there to be spentI tend to live for today and let tomorrow take care of itselfI am prepared to risk some of my own money when saving or making and investment“A combination of awareness, knowledge, skill, attitude and behaviour necessary to make sound financial decisions and ultimately achieve individual financial wellbeing”
6 Why aren’t these in the main questionnaire? Additional questionsA set of supplementary questions has also been developed to enable countries to undertake further exploratory study to inform their financial education initiatives or National Strategies.Why aren’t these in the main questionnaire?The core questionnaire is purposely short and focusedThe core questionnaire uses questions that can differentiate between levels of financial literacySome questions are not applicable across all sectors of the population, or all countriesWhat do they cover?A wide range of topics e.g.knowledge related to particular productsCertain behaviours, such as taking advice or making complaints (consumer protection related issues)Use and impact of creditUnderstanding risk
7 A common method of data collection Core questions to be used as a set, or placed before other questions when combinedCareful translation to retain the meaning of questionsTarget achieved sample of individuals aged 18+ (aiming for at least a 60% response rate)Weighted data to reflect gender/ age distributionPersonal interviews so that respondent’s literacy levels are irrelevantAdditional guidance available in toolkitData to be collected by professional survey organisations in each country using a robust method to maximise comparability
8 International measurement exercise 14 countries drawn from 4 continents agreed to use the core questionnaire developed by the OECD/INFE and submit the data for analysis;They included developed and emerging economies including middle (lower and upper), and high income economiesArmenia, Albania, BVI, Czech Republic, Estonia, Germany, Hungary, Ireland, Malaysia, Norway, Peru, Poland, South Africa, UKSince the initial exercise a wide range of other countries have used the questionnaire, and Estonia and South Africa have repeated the measurement to track changes.
9 OutcomesThe measurement toolkit meets a need for simple instruments to collect comparable financial literacy dataThe survey instrument is highly flexible and applicable across a wide range of countriesThe core questionnaire is also applicable in a wide range of circumstances, across different socio-economic groupsThe questions are flexible enough to be used alone, or combined with the supplementary questions or other surveysThe data can be used to create replicable measures of financial literacy that allow analysis within and across countries
10 Future plans Additional analysis and reporting The OECD/INFE will continue to use the first dataset to inform the work of the network and related research.Further data collection and sharing of toolkitRepeat the measure; both with original 14 countries and others: this is already happening!Collect translated questionnaires to share with other interested countriesEncourage all countries to incorporate the core questions in existing measurement exercises, and if possible, share the data with the OECD
11 Thank you Questions, comments, further information: OECD/INFERussian Trust Fund