Building more effective financial education approaches: Lessons for policymakers

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women teaching financial literacy to a man.
Photo by Lagos Techie on Unsplash

Financially capable individuals – those who make good financial decisions and interact effectively with the financial system – are more likely to achieve their financial goals and improve their family’s welfare.  Traditional financial education programs have had at best mixed results in encouraging people to stick with better financial decisions.

Despite the uncertain impacts of financial education, policy makers have embraced it. Roughly 100 countries have put in place formal or national financial education strategies whose overarching aim is to improve levels of financial capability nationwide.  Many though have faced challenges playing an effective role in the financial education space – particularly when initiatives rely heavily on events, training sessions, seminars and classroom-based lectures.  

A new World Bank Technical Note entitled “Building a Financial Education Approach: A Starting Point for Financial Sector Authorities" aims to help authorities get better results. The report provides key insights (summarized below) geared specifically towards financial sector authorities to help them build an effective financial education approach:

  • Tackle Risks First: Authorities should focus on addressing the inherent risks posed to consumers. This helps them remain more targeted in their interventions and have greater impact.
  • Understand Trade-Offs. Authorities should consider how best to prioritize their goals by assessing trade-offs between methods that are easy to implement, their capacity and resources, and the most pressing consumer risks.
  • Implement through Partnerships, Guidance and Public Tools: Three key areas are critical for building an effective framework: (i) partnerships with key institutions to embed financial education into existing financial programs; (ii) guidance to regulated entities on their day-to-day interactions with customers; and (iii)  developing financial education tools offered to the public (including consumers, institutions, intermediaries among others).
Making Financial Education More Effective: Tools, Channels, and Best Practices
  • Monitor and Evaluate: Adopt a practical monitoring and evaluation framework that tracks progress, monitors resource allocation, helps pilot new initiatives, and, to the extent feasible, measures impacts. 
  • Identify the right tools: Choosing the right tool and delivery channel is a critical step to ensure that financial education interventions are appropriate for their target audience. The report summarizes good practices and a growing body of evidence and country applications around interventions which use newer, innovative methods, behavioral insights and rigorous testing to demonstrate lasting behavioral change. 

Be sure to read the report and explore the appropriate role for financial sector authorities within financial education, effective approaches and good tools and practices to improve the effectiveness of financial education initiatives. 


Helen Luskin Gradstein

Financial Sector Specialist’

Arpita Sarkar

Financial Sector Consultant

Saba B. Abbas

Financial Sector Consultant

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