This document summarizes the state of financial education policies in Asia. It discusses the challenges of financial exclusion, new complex financial products, and low financial literacy levels in many Asian countries. It then outlines some policy responses at the national and regional level, including national strategies being developed or implemented in 15 Asian countries/economies. Some common targets of financial education programs in Asia are discussed, such as students, women, and low-income groups. The document concludes by suggesting policy areas that could be strengthened, such as collecting more evidence on financial literacy, strengthening financial education in schools, and systematically evaluating program impact.

1. FINANCIAL
EDUCATION POLICIES
IN ASIA
Chiara Monticone
OECD
OECD/Thailand Seminar on Financial Inclusion and
Financial Literacy in Asia
16-17 December 2014 – Bangkok, Thailand

2. Challenges
and
opportunities
State of
financial
education
policies:
national
strategies
Policy
suggestions
going
forward
Outline

3. • Africa (2012), Latin America and the Caribbean
(2013), Europe (forthcoming)
Part of a series of regional reports
Will be released as an OECD working paper in
the course of 2015
• Thanks to all who contributed: comments are
welcome
• It is still possible to reply and send more input by
30 January 2015
Based on a dedicated questionnaire among
members of the OECD INFE, previous surveys
and publications, and desk research
Draft report on
financial education in Asia

4. CONTEXT AND RATIONALE

5. Sustained growth
Decreasing poverty
Reformed and
strengthened
financial
institutions
Poverty
Inequality
Informality
Illiteracy
Social and financial
exclusion
Greatimprovements...
...openchallenges
Context

6. 1. Financial exclusion
2. New and potentially complex products
3. Low financial literacy
4. Population ageing
Rationale for financial education

7. Low inclusion in formal financial
markets and services on average…
0
10
20
30
40
50
60
70
80
90
100
Middle East
& North
Africa
(developing
only)
Sub-Saharan
Africa
(developing
only)
South Asia Latin
America &
Caribbean
(developing
only)
Europe &
Central Asia
(developing
only)
World East Asia &
Pacific
(developing
only)
High income:
OECD
Account at a formal financial institution (% age 15+)
Debit card (% age 15+)
Source: Demirguc-Kunt and Klapper (2012)
% of adults (15+) with an account
at a formal financial institution,
by region

8. ….and especially among some
population segments
0
10
20
30
40
50
60
70
80
90
100
Turkmenistan
Cambodia
Afghanistan
Pakistan
Azerbaijan
Indonesia
VietNam
Jordan
Philippines
India
Lebanon
Bangladesh
Kazakhstan
SaudiArabia
China
Malaysia
Thailand
HongKong(China)
Israel
Korea
Japan
Singapore
Bottom 40% of income All Top 60% of income
Source: Demirguc-Kunt and Klapper (2012)
% of adults (15+) with an account
at a formal financial institution,
by income level

9. New and potentially complex products
• Even when people are included, developing
financial markets mean new and potentially
complex products (eg. digital financial
services) >> raising financial consumer
protection and financial education issues

10. Low financial literacy
0
10
20
30
40
50
60
70
80
90
100
Division Interest paid
on loan
Risk and
return
Definition of
inflation
Time-value
of money
Calculation
of interest
plus
principal
Japan 2011
Korea 2012
Malaysia 2010
Thailand 2013
Sources: Japan: Central Council for Financial Services Information (2012); Korea: correspondence with the Bank of
Korea; Malaysia: Atkinson and Messy (2012); Thailand: Bank of Thailand (2013)
% of adults giving a correct
answer to each question
• Both in terms of low financial knowledge and of
• potentially harmful financial behaviours (eg. growing
shares of people in debt)

11. Additional challenges related to ageing
coming soon in some countries…
China
India
Indonesia
Japan
Korea
Thailand
0
5
10
15
20
25
30
35
40
2010 2015 2020 2025 2030 2035 2040 2045 2050
%
Source: OECD (2013b), Pensions at a Glance Asia/Pacific 2013, OECD Publishing.
Projected share of people age 65+ as a % of total population

12. POLICY RESPONSES

13. APEC Finance Ministers – 2012
• supported the development and implementation of strategies for financial
education drawing on the methodologies and tools developed by the World
Bank and the OECD/INFE
• adopted a Policy Statement on Financial Literacy and Education
encouraging APEC economies to use the OECD/INFE Guidelines for
Financial Education in Schools, and to consider the participation in PISA
financial literacy assessment
APEC Human Resources Development WG – 2012/2014
• project on Education on Financial and Economic Literacy
• publication of an APEC Guidebook on Financial and Economic Literacy in
Basic Education (November 2014)
ASEAN – 2013
• Chairman’s Statement of the 23rd ASEAN Summit in 2013 – reiterated the
importance of promoting financial literacy in the region
Regional recognition

14. 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.
Among over 50 countries worldwide, 15 Asian countries and
economies are developing a national strategy:
>> 7 are being implemented
>> 8 are being developed
National strategies
for financial education

15. National strategies’ development

16. Financial
consumer
protection
Financial
education
Financial
inclusion
Policy priorities and links
Close links between financial inclusion, financial consumer
protection, and financial education, for instance:
• Institutional and policy links between FE and FCP in
China Indonesia and Korea
• Financial education as an important element of
financial inclusion policies in India and Malaysia
• Collaborations between public authorities and private
financial institutions to promote financial education and
financial inclusion in India, Indonesia, Malaysia, Singapore

17. Low-
income
and
marginali
sed
people
• China
• India
• Israel
• Malaysia
• Pakistan
• Saudi
Arabia
• Singapore
Students
and/or
young
people
• Indonesia
• Israel
• Japan
• Korea
• Lebanon
• Malaysia
• Singapore
Women
• Indonesia
• Malaysia
• Lebanon
• Pakistan
• Saudi
Arabia
Migrants
• China,
• India
• Indonesia
• Philippin
es
MSMEs
• Indonesia
• Malaysia
• Pakistan
Elderly
• Singapore
Main targets

18. Financial education topics
integrated in the school
curriculum
• at different levels (primary/secondary) and in
different subjects in China, Hong Kong
(China), Indonesia, Japan, Korea, Thailand,
Singapore
Efforts to strengthen and
expand provision
• Specific financial education curricula at
regional/local level in China
• Proposal for integration in the national
curriculum in Malaysia
• ongoing revision of learning outcomes in
Japan
• Qualitative research to better understand
needs and opportunities in Hong Kong
Financial education in schools

19. POLICY SUGGESTIONS

20. Policy suggestions
• More cross-country comparable evidence on
financial literacy and not only on financial
knowledge
Collect more evidence on
financial literacy
• Financial institutions’ involvement can have
pros and cons
• Recently approved OECD/INFE Guidelines
Ensure coordination and
stakeholders’ monitoring
• Integrate FE in compulsory subjects, develop
dedicated learning frameworks and
professional teachers’ training
Strengthen financial
education in schools
• in the relevant countries, which may build on
the experience of Europe and North America
Address challenges of
ageing population
• little evidence to date of programme impact
• Conduct evaluation systematically and share
its results
Support programme
evaluation

21. THANK YOU!
Feedback and additional input welcome
Chiara.Monticone@oecd.org
www.financial–education.org
www.oecd.org/finance/financial-education