FINANCIAL EDUCATION
IN EUROPE:
AN OVERVIEW
Chiara Monticone
OECD
High-level conference on global and European trends in
fi...
Rationale:
why financial
education in
Europe
The current
status
Challenges
and future
directions
Outline
• Survey on financial education in Europe
– It covers financial education and to some
extent also financial consumer prote...
RATIONALE
• Most European countries underwent
several pension reforms starting from the
early 1990s aimed at improving financial
sus...
Household indebtedness
Italy
Germany
France
United States
United
Kingdom
0
20
40
60
80
100
120
140
160
180
200
2005 2006 2...
Financial exclusion
0
10
20
30
40
50
60
70
80
90
100
ARM
MDA
ALB
UKR
KSV
ROM
RUS
MNE
BGR
BIH
TUR
BLR
SRB
POL
ITA
HUN
MKD
L...
A complement to financial consumer
protection and regulation
-60
-50
-40
-30
-20
-10
0
10
20
IRL
BEL
ESP
PRT
NLD
SVN
GBR
H...
… in a context of low financial literacy
-
10
20
30
40
50
60
70
80
90
100
Albania2010
Armenia2010
CzechRepublic2010
Estoni...
POLICY RESPONSES
A NS is a nationally coordinated approach to financial education
which consists of an adapted framework or programme that:...
National strategies for
financial education in Europe
Feb
2012
May
2014
Aims of national strategies
The overarching purpose of all these NSs is to strengthen financial
literacy and promote posit...
Coordination mechanisms between
finance/education public authorities, private sector
and non-profits are in place in most ...
Women
Turkey
Migrants
Portugal
and Spain
Elderly people
Portugal, Romania,
Spain, Turkey,
United Kingdom
Low-income groups...
Provision of financial education in schools is uneven
and limited (up to schools/teachers, little professional
development...
Coordination
stakeholders’ coordination for the
development and implementation of
NSs is usually in place, but the
involve...
THANK YOU!
Questions and feedback welcome
Chiara.Monticone@oecd.org
OECD/INFE www.financial–education.org
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Chiara Monticone - 2014 Conference on Global and European Trends in Financial Education in Istanbul

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This presentation by Chiara Monticone was made during the 1st roundtable at the High-level Conference on Global and European Trends in Financial Education held on 22-23 May 2014 in Istanbul, which explored the role(s) of the private and not-for-profit sectors in financial education, financial literacy and innovation for young people and financial education for migrant workers and their families. Find out more at http://www.oecd.org/daf/fin/financial-education/2014-conference-global-european-trends-financial-education.htm

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Chiara Monticone - 2014 Conference on Global and European Trends in Financial Education in Istanbul

  1. 1. FINANCIAL EDUCATION IN EUROPE: AN OVERVIEW Chiara Monticone OECD High-level conference on global and European trends in financial education 22-23 May 2014 - Istanbul, Turkey
  2. 2. Rationale: why financial education in Europe The current status Challenges and future directions Outline
  3. 3. • Survey on financial education in Europe – It covers financial education and to some extent also financial consumer protection and financial inclusion – Will be published in the course of 2014 – Supported by VISA Europe  all European countries are still welcome to contribute Report on financial education in Europe
  4. 4. RATIONALE
  5. 5. • Most European countries underwent several pension reforms starting from the early 1990s aimed at improving financial sustainability of social security systems: – Lower replacement rates for future generations – Greater reliance on private pension provision to improve adequacy Pension reforms
  6. 6. Household indebtedness Italy Germany France United States United Kingdom 0 20 40 60 80 100 120 140 160 180 200 2005 2006 2007 2008 2009 2010 2011 2012 Household liabilities as a % of household nominal disposable income Declining but still very high in the UK Lower but increasing in other countries like Italy and France Source: OECD Economic Outlook No. 94
  7. 7. Financial exclusion 0 10 20 30 40 50 60 70 80 90 100 ARM MDA ALB UKR KSV ROM RUS MNE BGR BIH TUR BLR SRB POL ITA HUN MKD LTU GRC SVK CZE PRT CYP HRV LVA ESP IRL LUX BEL EST FRA AUT SVN GBR DEU NLD SWE FIN DNK All population Bottom 40% of income Top 60% of income Relatively lower levels and large variation across the population Percentage of adults population (15+) with an account at a financial institution (including bank, credit union, cooperative, microfinance institution, post office, debit card) Source: Global Findex Close to 100%
  8. 8. A complement to financial consumer protection and regulation -60 -50 -40 -30 -20 -10 0 10 20 IRL BEL ESP PRT NLD SVN GBR HUN DNK AUT GRC SWE CHE DEU FRA POL ITA FIN ISR EST TUR CZE LUX SVK NOR ISL Source: OECD (2014), Society at a Glance Percentage points variation in confidence in financial institutions between 2007 and 2012
  9. 9. … in a context of low financial literacy - 10 20 30 40 50 60 70 80 90 100 Albania2010 Armenia2010 CzechRepublic2010 Estonia2010 Germany2010 Hungary2010 Ireland2010 Norway2010 Poland2010 Serbia2012 UnitedKingdom2010 On average in these European countries, less than 70% of the adult population can answer correctly eight financial knowledge questions 16% of UK adults shop around for financial products. This is even lower in other countries. About 20% of Estonians resorted to borrowing the last time their income fell short of their expenditure About half of Albanians disagree that money is there to be spent, but only 12% of Polish respondents Source: OECD/INFE financial literacy survey Average percentage of adult population in each country answering correctly eight financial knowledge questions
  10. 10. POLICY RESPONSES
  11. 11. A NS is a nationally coordinated approach to financial education which consists of an adapted framework or programme that: • Recognises the importance of financial education and defines its meaning and scope at the national level in relation to identified national needs and gaps; • Involves the co-operation of different stakeholders as well as the identification of a national leader or coordinating body/council; • Establishes a roadmap to achieve specific and predetermined objectives within a set period of time; and, • Provides guidance to be applied by individual programmes in order to efficiently and appropriately contribute to the NS. Around the world: 28 countries are designing/ developing their NS, 18 are implementing it, and 8 are revising their first NS or implementing a second revised one Of these countries, one third is in Europe National strategies for financial education
  12. 12. National strategies for financial education in Europe Feb 2012 May 2014
  13. 13. Aims of national strategies The overarching purpose of all these NSs is to strengthen financial literacy and promote positive financial behaviours, with a focus on: Reducing over- indebted- ness e.g., Croatia, Estonia, Latvia, Netherlands, Portugal, Serbia, Turkey, United Kingdom Improving long-term saving e.g., Croatia, Netherlands, Portugal, Serbia, Spain, Turkey Improving financial inclusion e.g., Croatia, Estonia, Latvia, Portugal, Romania, Turkey Raising awareness of consumers’ rights e.g., Poland Supporting pension reforms e.g., Latvia, UK
  14. 14. Coordination mechanisms between finance/education public authorities, private sector and non-profits are in place in most countries Private sector involvement: Certification systems / codes of conduct / principles (e.g., Czech Republic, Netherlands, Portugal, Spain) – voluntary but linked to official recognition of programmes within the NS Stakeholders
  15. 15. Women Turkey Migrants Portugal and Spain Elderly people Portugal, Romania, Spain, Turkey, United Kingdom Low-income groups Latvia, Portugal, Romania, Russian Federation, Turkey Young people Czech Republic, Estonia, Latvia, Netherlands, Poland, Portugal, Romania, Russian Federation, Serbia, Slovenia, Spain, Sweden, Turkey, United Kingdom SMEs Romania, Serbia, Turkey Others Pre-retirement, disabled, etc. Main target groups
  16. 16. Provision of financial education in schools is uneven and limited (up to schools/teachers, little professional development, no examinations), but growing National standards / Learning frameworks (e.g. the Czech Republic, the Netherlands, the Slovak Republic) Integrated in school curriculum in another subject (e.g., England and Spain) Pilot projects in limited number of schools before scaling up (e.g., Italy and Spain) Financial education in schools
  17. 17. Coordination stakeholders’ coordination for the development and implementation of NSs is usually in place, but the involvement of private and not-for- profit sectors can require additional specific monitoring/ compliance mechanisms Evaluation most countries monitor the implementation of their NS but only few evaluate its impact (or parts of it) Innovation how to incorporate new technologies and ideas from other fields to reach and engage particular groups Core competencies the development of learning outcomes / core competencies frameworks is an important step not only for developing FE in schools but also for adults Challenges and way forward
  18. 18. THANK YOU! Questions and feedback welcome Chiara.Monticone@oecd.org OECD/INFE www.financial–education.org

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