Taking Stock Financial

7/27/2019 Taking Stock Financial

1/129

TAKING

STOCK

FINANCIALEDUCATIONINITIATIVESFORTHEPOOR

A REPORT


2/129

Copyright0TheMasterCardFoundation

ThispublicationmaynotbecopiedoradaptedwithoutthepermissionromTheMasterCardFoundation

PleasecreditTheMasterCardFoundation,MicronanceOpportunities,andGenesisAnalytics,GlobalStudyon

FinancialEducationReport

Foranycommercialreproduction,pleaseobtainpermissionrom

TheMasterCardFoundation

StClairAvenueEast

Suite0

Toronto,Ontario

CanadaMTT

Emailino@mastercarddnorg

Webwwwmastercarddnorg

PrintedinCanada


3/1291

ACKNOWLEDGEMENTS

This report has benetted rom generous contributions o time and efort by many individuals

and organisations. The research design, raming and writing o the report was led by Monique

Cohen and Ana Klinic rom Micronance Opportunities; and Alyna Wyatt, Jessica Benjamin

and Paul Zille rom Genesis Analytics. Bailey Butzberger, Julie Lee and Jessica Massie also

contributed to case research and writing on behal o Micronance Opportunities.

Wereceivedincrediblesupportrommanyindividualsacrossthecasestudyorganisations

TheyprovidedinvaluableinsightsandhelpedusaccesscriticaldataandinormationontheirnancialeducationprogrammesThecasestudyorganisationsincludetheAssociationo

MicronanceInstitutionsoUganda(AMFIU);FauluDeposit-TakingMicronanceLtd,Kenya;

FinancialLiteracyFoundation,Uganda;FINCAMexico;FreetoGrowMoneySense,Arica;

JuniorAchievement,Nigeria;OpportunityInternationalBankoMalawi(OIBM);Population

CouncilProgrammes,KenyaandEgypt;PrivateEducationDevelopmentNetwork(PEDN),

Uganda;SouthAricanInsuranceAssociation(SAIA);SupportProgrammeorEnterprise

EnterpriseEmpowermentandDevelopment(SPEED),Ghana;andXacBank,Mongolia

HannaSchommerromDeutscheGesellscharInternationaleZusammenarbeit(GIZ)

wasalsoparticularlyhelpulinprovidinginormationontheSPEEDGhanacase

KristinHunterprovidedgreatsupportincompilingandcopyeditingthereportFromwithin

TheMasterCardFoundation,aspecialthankstoAlexandraPattee,RuthDueckMbeba,

KristaPawleyandJyotsanaSahawhocontributedtothenalproductionothereport

RewaMisra

ProgramManager

TheMasterCardFoundation


4/1292

ABOUT THE ORGANISATIONS:

GenesisAnalytics,aJohannesburg-basedeconomicsconsultingrm,provideseconomic

andstrategicadvice,acrossarangeosectors,togovernments,developmentinstitutions

andprivatecorporationsaroundmarket-based,privatesector-ledsolutionstopovertyand

developmentchallengesthroughtheBusinessinDevelopmentpracticeGenesis-Analytics

currentlymanagestheFinancialEducationFund(FEF),aDIDundedchallengeundwith

eenundedprojectsineightAricancountriesProjectscoveradiversityodelivery

channelsandtargetaudiencestodeterminetherelativeeciencyandeectivenessodierentmodelsonancialeducationtoequippoorpeopleinAricawiththeskillsand

knowledgetomanagetheirnanceseectively

MicronanceOpportunitiesisaglobalnonprotorganizationcommittedtounderstanding

thenancialrealitiesolow-incomehouseholdsanddevelopingconsumer-ocusedsolutions

Itsworkshapesthedesignanddeliveryonancialproductsandservices,andenhancesthe

capacityolow-incomeconsumerstomakeinormednancialdecisionsIncollaborationwith

awiderangeopublicandprivatesectorpartners,MicronanceOpportunitiesresearch

andexpertisehelptoincreaseconsumeraccesstonanceinthedevelopingworld

Foundedin00,MicronanceOpportunitiesisbasedinWashington,DC

TheMasterCardFoundationadvancesmicronanceandyouthlearningtopromotenancial

inclusionandprosperityThroughcollaborationwithcommittedpartnersincountries,

TheMasterCardFoundationishelpingpeoplelivinginpovertytoaccessopportunitiesto

learnandprosperTheMasterCardFoundationhasactivelysupportnancialeducation(FE)

initiativesacrosstheglobesinceitsinceptionAnindependent,privateoundationbasedin

Toronto,Canada,TheMasterCardFoundationwasestablishedthroughthegenerosityoMasterCardWorldwideatthetimeothecompanysinitialpublicoeringin00Formore

inormation,pleasevisitwwwmastercarddnorg


5/1293

1

23

31

32

33

4

5

6

7

71

72

73

74

75

76

8

A

B

C

D

E

F

GH

J

K

L

LISTOFFIGURES

LISTOFABBREVIATIONS

INTRODUCTION

METHODOLOGYINSTITUTIONSANDTHEIRFINANCIALEDUCATIONOBJECTIVES

CONSUMERPROTECTIONANDAWARENESS

PRODUCTUPTAKEANDIMPROVEDPRODUCTUSE

PERSONALDEVELOPMENTFORIMPROVEDLIVELIHOODS

TARGETAUDIENCE

FINANCIALEDUCATIONCONTENT

FINANCIALEDUCATIONDELIVERYCHANNELS

WHATWORKSINFINANCIALEDUCATION

WHATISSCALEINFINANCIALEDUCATIONPROGRAMMES?

WHATFACTORSFACILITATESCALE?

WHATARETHECOSTSINVOLVEDINFINANCIALEDUCATION?

HOWDOFINANCIALEDUCATIONINITIATIVESDEFINESUSTAINABILITY?

WHICHSOLUTIONSHELPSUSTAINFINANCIALEDUCATION?

ENHANCEDIMPACTWHATIMPROVESFINANCIALEDUCATIONUPTAKE?

CONCLUSION

APPENDIXOIBMOPPORTUNITYINTERNATIONALBANKOFMALAWI

XACBANK,MONGOLIA

FINCAMEXICO

SPEEDSUPPORTPROGRAMMEFORENTERPRISEEMPOWERMENT

ANDDEVELOPMENT,GHANA

AMFIUASSOCIATIONOFMICROFINANCEINSTITUTIONSOFUGANDA

SAIASOUTHAFRICANINSURANCEASSOCIATION

FREETOGROWMONEYSENSE,AFRICAFINLITFINANCIALLITERACYFOUNDATION

JAJUNIORACHIEVEMENT,NIGERIA

FAULUDEPOSIT-TAKINGMICROFINANCELTD,KENYA

POPULATIONCOUNCILPROGRAMMES,KENYAANDEGYPT

REFERENCES

PEOPLEINTERVIEWEDORSENTQUESTIONNAIRES

4

5

6

710

10

11

13

14

15

17

19

19

20

21

23

23

24

27

28

38

45

56

65

71

7684

97

103

112

121

126

CONTENTS


6/1294

1

2

3

4

56

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29

CaseStudiesataGlance

ImpactMeasurementollowingFinancialEducation

ReportedUseoFinancialServicesinMalawi,00

FinancialEducationHistory

LengthoExposuretoFinancialEducationoranOIBMClientCostsoFinancialEducation

IncreaseinOIBMsClients,0000

OIBMLoanPortolioandDeposits,0000

XacBankFinancialEducationTrainingOutreach

XacBankImpactIndicators

XacBankMarketingMaterials

ATMDummyUsedbyFINCAinClientTraining

FINCAsATMBooklet

FINCACallCentreQuestions

CardProblemsReportedtotheCardCentre

FINCALoansDisbursedthroughPre-paidCards,October009Mid-July009

AmountoLoansDisbursedromOctober009toJuly00

PhotosromRoadShowsacrossGhana

AudienceParticipationoverthe0-WeekFinancialLiteracyEducationRadioProgramme

CostsoSPEEDFinancialEducationProgramming

ImpactotheRoadShowsonSampleBanks

AMFIUCEPPosters

DeliveryChannelsUsedintheComutaNetCampaign

ImpactasReportedbyMoneySenseParticipants,Post-Training

FinancialBehavioursoSurveyedUgandans

MembershipSubscriptionFees

ActivitiesandCostsoaPEDNProgramme

CostsoFaulusFinancialEducation,00

ExcerptromMakutanoJunctionComicLeafet

8

25

29

30

3134

35

36

40

42

43

48

49

50

51

52

52

58

60

61

63

67

73

82

85

88

94

105

107

FIGURES


7/1295

LIST OF ABBREVIATIONS

AssociationoMicronanceInstitutionsoUganda

automatictellermachine

community-basedorganisation

community-basedtrainer

UKDepartmentorInternationalDevelopmentFauluAdvisoryServices

nancialeducation

FoundationorInternationalCommunityAssistance

FinancialLiteracyFoundation

FinancialServicesBoard(SouthArica)

FinancialSectorCharter(SouthArica)

GhanaMicronanceInstitutionNetwork

JuniorAchievementLivingStandardMeasurement(SouthArica)

MongolianEducationAlliance

micronanceinstitution

MicronanceOpportunities

MinistryoFinanceandEconomicPlanning(Ghana)

non-governmentalorganisation

OpportunityInternationalBankoMalawi

PrivateEducationDevelopmentNetwork

personalidenticationnumber

pointosale

SouthAricanInsurersAssociation

small/mediumenterprise

SupportProgramorEnterpriseEmpowerment&Development

WomensWorldBanking

AMFIU

ATM

CBO

CBT

DFIDFAS

FE

FINCA

FinLit

FSB

FSC

GHAMFIN

JALSM

MEA

MFI

MFO

MoFEP

NGO

OIBM

PEDN

PIN

POS

SAIA

SME

SPEED

WWB


8/1296

TAKING STOCK:FINANCIAL EDUCATION INITIATIVES FOR THE POORSYNTHESIS REPORT

MICROFINANCEOPPORTUNITIESANDGENESISANALYTICS

1. INTRODUCTION

Whenpeoplehavelowlevelsonancialliteracy,theyoenmakeunproductivenancial

decisionstheyspendtheirmoneyinsuboptimalways,borrowtoomuch,savetoolittle,

andmissopportunitiesorinvestingBycommunicatingtheknowledge,skills,andattitudes

associatedwithsoundmoneymanagement,nancialeducationcanoertheseindividuals

themeanstousetheirscarcenancialresourcesmoreeectivelyandtochoosethenancial

servicesandproductsthatbestmeettheirneeds

Theobjectiveothisreportistounderstandthelandscapeonancialeducation

programsorlowincomehouseholds,whatworksinnancialeducationprogrammes

orsuchhouseholdsandwhyThisobjectiveisexploredwithrespecttothreeresearch

categoriesenhancingimpact,increasingscaleandsustainingaccessIntermsoenhancing

impact,thereportexplores(onthebasisoinormationalreadyavailablewithcase

organisations)whatimprovesnancialcapabilityandwellbeingorwomen,youth(bothmen

andwomen),andtheirhouseholdsThereportseekstounderstandhownancialeducation

programmescanincreasescalebyexaminingdeliverychannelsandmethodsoscalingup

Toexaminesustainableaccess,thereportseekstoidentiymarketandothersolutions

tosustainnancialeducationprogrammesFinally,thereportseekstoexplorethe

interconnectionsandtradeosbetweenenhancingimpact,increasingscaleandsustaining

accessornancialeducationprogrammes

Toachievethisobjective,TheMasterCardFoundation(theFoundation)commissioned

MicronanceOpportunities(MFO)andGenesisAnalytics(GA)toreviewtheexperiences

oorganisationsworldwideThesecasestudiesoerinsightsintotheirnancialeducation

strategies,especiallythoseaimedatyoungpeopleandvulnerableindividualsTheyoutline

thesuccessesandchallengestheorganisationsencounteredindesigninganddelivering

eectivenancialtraining

Financialeducation,asusedinthisreport,reerstotheprocessointroducingpeopleto

theknowledge,skills,andattitudesrequiredorresponsibleearning,spending,saving,

borrowing,andinvestingBybroadeningpeoplesunderstandingonancialoptionsand

principles,nancialeducationbuildsskillstousenancialproductsandservices,and

promotesattitudesandbehavioursthatsupportmoreeectiveuseoeconomicresources

1

MCohenandCNelson(2011)FinancialLiteracyASteporClientstowardsFinancialInclusiondrapaperWashingtonDC


9/1297

Thecasestudyorganisations,mostlyromSubSaharanArica,havebeenparticularly

successulinreachinglow-incomegroups,youth,andwomenwiththeirnancial

educationprogrammesThecasestudiesreviewthevariousattributesotheprogrammes

theirmodels,methods,anddeliverymechanismsaswellastheeconomicandsocialbenets

orclients

Thesynthesisreportsummarizesndingsromthecasestudies,whichareincludedasannexestothereportItbeginsbyoutliningthemethodologyotheresearchinitiative,

ollowedbyanoverviewothecasestudyorganisationsandtheirnancialeducation

objectivesThereportoutlinesthethreegeneralcategoriesonancialeducation

objectivesthatexistwithinthecasestudiesconsumerprotectionandawareness;product

uptakeandimproveduse;andpersonaldevelopmentorimprovedlivelihoodsItthen

presentsthetargetaudienceothenancialeducationprogrammesollowedbyan

overviewotheirnancialeducationcontentanddeliverychannelsThesynthesisreport

nishesbyoutliningwhatworksinnancialeducation,asobservedromthecasestudy

organisationsThereportpresentsthesendingsaccordingtosixquestions Whatisscaleinnancialeducationprogrammes?

Whatactorsacilitatescale?

Whatarethecostsinvolvedinnancialeducation?

Howdonancialeducationinitiativesdenesustainability?

Whichsolutionshelpsustainnancialeducation?and

Enhancedimpactwhatimprovesnancialeducationuptakeanduse?

Theanalysesotheseactorsarenotintendedtobegeneralconclusions,butrather

context-specicobservationsandinsightstobuilduponinordertodesignbetterprogrammestrategiesthatboostpeoplesnancialcapabilities

2. METHODOLOGY

Thecasestudiespresentedinthisreportcoverdiversenancialeducationprogrammes,

implementedbyvariousorganisations,includingbanks,community-basedorganisations

(CBOs),non-governmentalorganisations(NGOs),privatecompanies,anddonororganisations

Theseorganisationsuseavarietyodeliverymethods,curricula,andprogrammemodelsto

delivernancialeducationtolow-income,vulnerable,andyoungpopulations(seeFigure)

TheMasterCardFoundation,MicronanceOpportunities,andGenesisAnalyticsworked

collaborativelytoselecttheorganisationsusingtheollowingcriteriatypeoorganisation,

availableinormation,ocusonyouthandwomen,anddiversityoprogrammemodelsThe

developmentoeachcasestudyinvolvedourdaysodeskresearchtoreviewinormation

providedbytheorganisationsthemselvesThendingsromthisresearcharebasedon

writtendocumentssuchasprogrammereports,trainingmanuals,monitoringreports,and

impactassessmentsInaddition,researchwasconductedthroughin-depthquestionnaires

orinterviewswithseniororprogrammemanagementineachorganisationThisinormation

anddatawascollectedupuntilOctober00Thewritingothecasestudiesolloweda


10/1298

ORGANISATION

COUNTRY

ORGANISATIONT

YPE

OBJECTIVE

DELIVERY

MECHANISM

TARGETAUDIENCE

HIGHLIGHT

AMFIU

Uganda

Micronanceindustry

organisation

Consumer

protection

andawareness

Toolsandmassmedia

Economically

activeyouth

over18

Multi-prongedmassmediacampaign

includingradio,music,danceand

drama,posters,yers,picturecards,

ipcharts,cons

umerhandbooks,

newspapers,TV

talkshows,publica-

tions,andworkshops

Fa

ulu

Kenya

Depos

ittaking

micro

nance

institution

Productuptake

andimproved

productuse

Face-to-acetraining,

multimedia,tools

Economically

activelow-income

adults(ruraland

urb

an)

Diversiednancialeducation

deliverychanne

lsandtoolstomeet

diferentmarketneeds

FINCA

Mexico

Micronance

institution

Branchlessbank-

ingproductuptake

Face-to-acetraining

Economically

activelow-income

wo

men,predomi-

nantlyrural

Financialeduca

tionlessonstobuild

condenceand

knowledgearound

prepaidcards(FINCAhasreached

10,500peoplewithprepaidcards,all

owhomreceivednancialeducation

training.)

Fi

nLit

Fo

undation

Uganda

Industryorganisation

Financialskills

development

Workshopsand

clinics

Ug

andanpublic

above16

Annualnancialliteracyweeks(The

numberoparticipants,1,500-3,000,

doubledrom20092010.)

Fr

eetoGrow

Kenya,

Namibia,

Tanzania,

Uganda,

South

Arica

Person

aldevelop-

menta

ndtraining

specialists

Personal,

interpersonal,a

nd

organisational

development

Face-to-acetraining

Low-income

em

ployeeso

largecompanies,

wit

hlowlevelso

lite

racy

Useoexperien

tiallearning:meta-

phor,imagery,a

necdotes,andcase

examplestoma

keabstractconcepts

easiertounderstand

Ju

nior

Achievement

Nigeria

NGO

Personaldevelop-

mentorimproved

livelihoods

Face-to-acetraining

Primaryandhigh

sch

oolstudents;

someout-o-

sch

oolyouth

Useoexistinginrastructureand

networksthroughNigerianschools;

ocusonlearningbydoing

O

IBM

Malawi

Micronancebank

Productuptake

andimproved

productuse

Face-to-acetraining,

andmultimedia

Economically

activeadultswith

oc

usonyounger

adultsages20

to30

Useoace-to-

acetrainingasan

added-valueserviceandcustomer

relationship-buildingmechanism

OIBMreached300,000people.)

FIG

URE1

CASESTUDIESATA

GLANCE


11/1299

FIG

URE1

CASESTUDIESATA

GLANCE

ORGANISATION

COUNTRY

ORGANISATIONT

YPE

OBJECTIVE

DELIVERY

MECHANISM

TARGETAUDIENCE

HIGHLIGHT

PEDN

Uganda

NGO

Personaldevelop-

mentorimproved

livelihoods

Face-to-acetraining

Youthages6to16

Useoyouthclubsatschools(man-

agedbyyouths)asadeliverychannel

ornancialeducation.

Population

Council

Egypt

andUganda

NGO

Personaldevelop-

mentorimproved

livelihoods

Face-to-acetraining

Ad

olescentgirls

Financialliterac

yprogrammesasan

integralcomponentolivelihoods

agenda

SA

IA

South

Arica

Industryorganisation

Consumerprot

ec-

tionandaware-

ness

Massmedia

Peri-urban

andurban

commuters

TVsintaxiranks(potentiallyreaches

2.1millioncomm

utersperday,ata

relativelylowcostoaroundUS$0.25

perpersonreac

hed)

SP

EEDGhana

Ghana

NGO-donorunded

project

Consumerprot

ec-

tionandaware-

ness,product

uptake,and

improvedproduct

use

Toolsandedutain-

ment

Inormalsector

(lowleveloedu-

cation);people

aged1830and

stu

dentsentering

the

jobmarket,

wo

menand

wo

men'sgroups

Diverseyetcom

plementarychan-

nelstoreachawidespreadaudience:

roadshows,the

atreplaysandradio

campaigns(Fromtheoutset,SPEED

stakeholdersen

deavouredtoensure

sustainability.)

Xa

cBank

Mongolia

bank

nancialliteracy

skills

training

Ad

olescentgirls

aresultonan

cialeducation.


12/12910

commontemplate,withtheparticipatingorganisationsreviewingthedrastoensureall

inormationwasaccurate

Theseprogrammesareapartotheemergingeldonancialeducation,whichisstillin

anearlystageolearninganddevelopmentMostotheprogrammessurveyedinthisreport

arerelativelynewDuetothenatureotheseprogrammesandthecontextinwhichthey

operate,dataontheiraccomplishmentsandimpactwasoendiculttogatherandmaybeolimitedreliabilityThus,theevidenceprovidedinthecasestudies,aswellastheresulting

observations,shouldbeviewedascontext-specicinsightsratherthangeneralconclusions

3. INSTITUTIONS AND THEIR FINANCIAL EDUCATION OBJECTIVES

Therangeoorganisationsimplementingthedierentnancialeducationprogrammes

eaturedinthisreportisbroadItincludesormalandsemi-ormalnancialserviceproviders

(banksandmicronanceinstitutions),technicalserviceproviders(traininganddevelopment

serviceorganisations),andnon-protdevelopmentorganisationsandnetworks(nancial

industryassociations)Someoernancialeducationasacomponento,orcomplementto,theirprimarynancialproducts(OIBMOpportunityBankoMalawi,Faulu,andFree

toGrow)Othersintegratenancialeducationaspartoaholisticapproachtoimprove

livelihoods(PopulationCouncil)Whileothersollowaspecicmandatetodeliver

consumereducationwithanancialeducationcomponent(SAIASouthArican

InsuranceAssociation)

Thecasestudiesoeranopportunity

toexplorethestrengthsandweakness

othedierenttypesoorganisationsengagedinorsponsoringnancialeduca-

tionprogrammesTheanalysisindicates

thatnancialeducationprogrammesand

theirultimateresultsvarybasedonshort-

termprogrammegoalsandlong-term

objectivesTheorganisationsexploredin

thecasestudiescitevariousobjectives

ortheirnancialeducationprogrammes,

whichcanbegroupedintothreegeneralcategoriesconsumerprotectionand

awareness;productuptakeandimproved

productuse;andpersonaldevelopment

orimprovedlivelihoods

TheSouthAricanInsurance

Association(SAIA)hasamandateromthegovernmentoSouthAricatopromoteinsuranceeducationItoersvariousnancialeducationin-terventionsintendedtoincreasecon-sumerknowledgeaboutinsurance,aswellastheirrightsandresponsi-bilitiesasconsumerswhenbuying

productsromaccreditednancialservicesprovidersThisinitiativeisanexampleoasuccessulprivatepub-licpartnershiptoprovideconsumereducationaboutinsurance

2

Thetemplateusedorall12casestudiescontainsthesemainsectionsinstitutionalbackgroundtargetgroupnancialeducationbackgroundand/ormodelscalabilitysustainability(enhanced)impactandconclusion


13/12911

3.1 CONSUMER PROTECTION AND AWARENESS

Somebroad-basednancialeducationprogrammesseektochangeconsumerinteractions

withthenancialmarketApopularexampleothistypeoprogrammeistheuseonancial

educationasatooltointroducethepublictobasicnancialconceptsandtopromote

nancialinclusionortheunbankedIngeneral,nancialindustryassociationstypically

avourthistypeonancialeducationprogrammeastheyhaveamandatetochangesome

aspectothemarketinwhichtheirmembershipoperates(eg,AMFIUAssociationoMicronanceInstitutionsinUganda,andSAIA)

Partnershipsamonggovernmentagencies,civilsocietyorganisations,privatecompanies,and

NGOsplayavitalroleinbuildingawarenessaroundnancialliteracyTheobjectivesothese

partnerstypicallyocusonintroducinglargenumbersopeopletonancialconceptsandthe

ormalnancialsectoraswellasreachingthemwithkeymessagesNetworks(groupsosimilar

nancialinstitutionslinkedtogetherormutualbenetunderanumbrellaorganisation)playan

importantrolebypromotingnancialeducationandengagingtheirmembersincommon

initiatives(seeboxaboutSAIA)Someindustryassociationshavemandatorymembershiporsubscriptionees,whichcanullyundthe

nancialeducationprogrammes,while

othersmustdependonoutsidesubsidiesto

complementmembershipees

3.2 PRODUCT UPTAKE AND IMPROVED

PRODUCT USE

Financialeducationcanteachconsumers

aboutappropriateproductsandservices,therebyboostinguptakeanduseThis

canbemutuallybenecialorconsumers

andnancialserviceprovidersClients

canbecomebetterequippedtomanage

theirnancesandmakemoreappropriate

choicesaboutthenancialproducts

oeredInterviewswithcasestudy

organisationssuchasOIBMillustratethat

somenancialserviceprovidersperceiveimprovedportolioqualityasbeingaresult

olessriskyclientsThistypeonancial

educationprogrammeisgenerally

implementedbynancialinstitutions,

includingmicronanceinstitutions(MFIs)

andbanks(eg,FauluKenya,OIBM)

OpportunityInternationalBankoMalawi(OIBM)isthelargestcom-mercialmicronancebankinMalawiTogetherwithitsnancialproductline,OIBMoersnancialeducationaimedatimprovingthemoneyman-

agementskillsoitsclientsandtheiron-goinguseotheBanksproductsandservicesSincethestartoitsnancialeducationprogramin00,OIBMhasreachedapproximate-ly,000people OIBMsnancialeducationmodelisamixtureodirecttraining,mul-

timediamessages,andindividualmeetingsOIBMmeasuresthesuc-cessonancialeducationthroughimprovementsinportolioqualityindicatorsandincreasesintheuseoitsproductsandservices

3Unbankedherereerstopeoplewhodonothavephysicalaccesstonancialservicesorproducts(nonancial

institutionsexistintheirareaoraretooaraway)ordonothavesucientresourcesortheminimumagetobe

eligibleornancialservicesorproductsItgoesbeyondmerelynotusingabankornancialinstitutionandgenerallyreerstopoorpeopleatalllevels


14/12912

MFIsandcommercialbanksrequentlysponsornancialeducationprogrammesinaneort

tostrengthenandincreaseclientsuseotheirservices,andtogeneratecustomerloyalty

Throughregularinteractionsandbuildingrelationshipswithclients,nancialinstitutions

haveareceptiveaudiencethatcanbeleveragedtoreadilyoernancialtrainingto

low-incomepopulations

ManyothenancialinstitutionsincludedinthisreportemphasizethatmarketresearchisintegraltothesuccessuldevelopmentotheirnancialeducationprogrammesThey

gatherdataonclientslevelsonancialliteracyandstatusonancialinclusiontoinorm

thedevelopmentotheprogrammesYetsomenancialinstitutionsindicatedthat,in

practice,someotheirresearchocusesonunderstandingnancialproductgaps,rather

thanocusingexclusivelyonthenancialeducationneedsotheirclientsImportant

exceptionsarePopulationCouncilandXacBank,whousequalitativemarketresearch

ocusedonnancialeducationneedstoinormthedesignanddeliveryonancial

educationprogrammesortheirtargetpopulations

Thisreportobservesthatnancialinstitutionshaveaninvaluableadvantage,overother

organisationtypes,inprovidingnancialeducationTheyhavetheabilitytooertheirclients

animmediateopportunitytopractiseandapplynewly-acquirednancialmanagementskills

withactualnancialproductsAnexampleothisisbyopeningasavingsorcreditaccount

andusinganautomatictellermachine

(ATMs)

Further,thereportobservesthatthe

organisationsthatteamedupwithexternalorganisationsspecialisingincurriculum

andlearningprogrammedevelopment

(educationspecialists),achievedsigni-

cantbenetromthepartnershipThese

specialisedorganisationshavegreater

capacitytodevelopasoundnancialedu-

cationcurriculumandtheabilitytoattract

andleveragedonorsupporttoundsuch

programmesBothFauluandXacBankarepartoaconsortiumoinstitutions,

supportedbytheNikeFoundation,that

promotesnancialeducationandthe

developmentosavingsproductsor

FINCAMexicointroduceditsnancialeducationprogramtobuild

clientsknowledgeandcondenceaboutthepre-paidcarditoersand,ultimately,itsbranchlessbankingFINCAscomprehensivenancialeducationprogramaddressestheclientslevelotechnicalknowledgeandenhancestheirtrustinmobilebankingandothernancialtech-nologiesFINCAhasreached0,00peoplewithprepaidcardsAllre-ceivednancialeducationtraining

4Thevalueomarketresearchornancialeducationisbeingrecognizedmoreandmoreandnewnancialcapa

bilityinitiativessuchasYouthStartandYouthSaveareincorporatingitaspartotheirprogramdesign

5Grayetal(2009)showthistobeanimportantactorensuringtheeectivenessonancialeducationpro

grammesBGrayJSebstadMCohenandKStack(2009)CannancialEducationChangeBehaviour?LessonsromBoliviaandSriLanka(WashingtonDCMicronanceOpportunities)


15/12913

adolescentgirlsTheirprogrammemodelsarepremisedonthebeliethatnancialeducation

willbenetadolescentgirlsastheytransitiontoadulthood,entertheworkorce,andaregiven

theopportunitytoopenandusetheirrstbanksavingsaccount

Financialeducationalsoplaysanimpor-

tantroleinbranchlessbankinginitiatives

Forexample,FINCAMexicosexperienceshowsthatnancialeducationhelped

bringtheintroductionopre-paidcards

toscaleintheMexicannancialservices

marketFINCAMexicoseesnancial

educationastheprincipaldriverorthe

increaseduptakeanduseothecards

3.3 PERSONAL DEVELOPMENT FOR

IMPROVED LIVELIHOODSNGOsandotherpersonaldevelopment

andtrainingorganisationswithinthe

report(eg,PopulationCouncil,Freeto

Grow)viewnancialeducationasapart

oamoreholisticsocialagendathatoers

nancialknowledgeandskillsasameans

toimprovenancialdecision-making,

socialwell-being,andgenerallivelihoods

Theirnancialeducationmaterialsstress

personalandsocialdevelopmentaschie

outcomesandtheirprogrammesinclude

extensiveparticipationineducational

activities

Particulartothisgrouponancialeducationprovidersistheircustomizationothe

curriculumtomeettheneedsospecictargetaudiencesInaddition,theseprogrammes

seektoexpandthetraditionalscopeonancialeducationprogrammesbyreachingintocommunitiesthatareexcludedrommassmedia

Thecasestudyanalysisalsohighlightstwoschool-basedprogrammes,JuniorAchieve-

ment(JA)NigeriaandPrivateEducationDevelopmentNetwork(PEDN)Uganda,which

oernancialeducationcombinedwithbusinessandentrepreneurshiptrainingtoprimary

ThePrivateEducationDevelop-mentNetwork(PEDN)inUgandaisanon-protorganisationestablishedin00PEDNseekstoempoweryouthbyestablishingentrepreneur-shipandbusinessskillsprogramsinpublicandprivatesecondaryschools,aswellasincommunities

PEDNsobjectiveistoproducecre-ativeandcompetitiveindividualswhoareproductivejobcreators,notjust

jobseekersAeatureoPEDNsap-proachisitsmethodologyToencour-agecreativityandcriticalthinking,PEDNcombinesnancialeducationwithentrepreneurialandbusinessskillstraining,aswellasanopportu-nitytosave,sothatparticipantsareabletoimmediatelyputnewknowl-edgeintopractice

6

ThepartnersintheNikeFoundationinitiativeincludeCAREPopulationCouncilWomensWorldBankingMicronanceOpportunitiesXacBankADOPEMKREPBankandFaulu


16/12914

andhighschoolstudentsBothothese

programmesareproactiveinocusThey

concentrateonpreparingyoungpeople

orautureintheworkorcebyhelping

themdevelopthepositiveattitudesand

skillstheyneedtosucceedinthejob

market

4. TARGET AUDIENCE

Mostotheorganisationsinthisre-

porttargetcomparablepopulations

youngpeople,vulnerablegroups,and

low-incomepopulationsindeveloping

countriesThetargetaudienceslivein

bothurbanandruralareas,havelimitedormaleducation,andsurvivebymanag-

ingtheircashfowsonaday-to-daybasis

Manyaceendlesschallengesasaresult

olimitedincomes

Thesecharacteristicsoersignicant

challengestothedesignanddeliveryonancialeducationprogrammesThendingso

thisreportsuggestthat,totheextentpossible,nancialeducationprovidersshouldseg-

menttheirtargetmarketstoensurethattheirprogrammesrefectvariancesinnancial

educationneedsandprioritiesProgrammesshouldtakeintoaccountthelearnersstage

inlie,aswellasdemographicandculturaldierencesbetweengroupsAllactorshave

implicationsorthesuccessuldeliveryandtheappropriatenessothecontentonancial

educationprogrammes

Itisimportanttonotethatmanyothenancialeducationprogrammestargetonlyindi-

vidualsolegalagetoaccessnancialservices(Manycountrieshaveaminimumageor

openinganaccount,suchasyearsinKenyaandyearsinMongolia)OthersareopentoyoungerpeopleTheyrecognizethatmanyyoungpeople,boththosewhoareinandout

oschool,beginearningalivingearlyinlieandwillbenetromacquiringmoneymanage-

mentskillsintheirteens,inotsoonerJANigeriaandPEDNbelievethatitisimportant

thatnancialeducationbeginsatanearlyageByteachingyoungpeopletheprincipalso

moneymanagement,theywillbeequippedwiththeappropriatetoolsandknowledgeto

makeproductivenancialdecisionswhentheybecomeeconomicallyengaged

MicronanceOpportunities(MFO)isanon-protorganisationoundedin00andworksatthenexusbetweenconsumersandnancialserviceprovidersItdevel-

opedasetonancialeducationresourcesthatarereadilyadaptabletodierentpopulationsanddeliverychannels,andreachedscaleinouryearsworkingwithadiverserangeopartnersManyotheorganisationshighlightedinthisreviewhaveusedMFOscorecurriculumandhave

adaptedittotheirspecictargetaudiencesMFOsexperiencetodateshowsthatnancialeducationcanchangesavings,budgeting,anddebtmanagementbehaviours

7

DCollinsJMorduchSRutherordandORuthven(2009)PortoliosothePoorHowtheWorldsPoorLiveon$2aDay(PrincetonNJUSAPrincetonUniversityPress)


17/12915

5. FINANCIAL EDUCATION CONTENT

Tobeeective,thecontentanddeliverychannelornancialeducationprogrammesneed

tobepracticalanduseultotheirtargetaudiencesIndividualsaremorelikelytoretainand

adoptkeymessagesithenancialeducationcurriculumisrelevanttoparticulargoalsor

problemstheyaceFurther,manyothecasestudyorganisationsstressthattheirclients

nancialeducationneedsareconstantlychangingThisrequiresthatcontentandmessages

berereshedandupdatedatregularintervalsThesameholdstrueornancialproducts

andservicesOIBMreviewsitsnancialeducationsyllabusonaquarterlybasistoensure

thatitismeetingtheprioritiesoitstargetaudienceAMFIUalsoappreciatestheimpor-

tanceodevelopingnewcurriculummaterial,citinginnovationasanongoingactivityand

costintheimplementationoitsnancialeducationprogramme

Organisationsrequireinsightintothecultural,social,andeconomicdynamicsotheirtarget

audiencesinordertoensuretheirnancial

educationcurriculaisrelevantCertainnancialmanagementskillsneedtobe

prioritizedaccordingtothesedynam-

icsInvesting,orexample,maybeless

relevanttoyoungandvulnerablegroups

than,say,budgetingandsaving

Likenancialproducts,itcanbesaid

thatthedesignoanancialeducation

programmeshouldollowasequential

developmentprocessmarketresearch,

concepttesting,pilottesting,rene-

ment,androlloutFollowingthisprocess

willhelptoensurethatthecurriculumis

designedonneed-anddemand-driven

basesBothSPEEDGhanaandFinLit

conductedpre-programmeassessments

toensurethattheirnancialeducationcontentwasrelevanttotheirtargetaudi-

encesThishasbeencrucialtoensuring

thatSPEEDGhanasmessageshaveahigh

impactFreetoGrow,aprivatetraining

anddevelopmentserviceprovider,con-

ductscontinualcontentandcourseevaluationstoensurethatparticipantsarebothsatised

andbenettingromthenancialeducationprogramme

FreetoGrowsMoneySensepro-grammeprovideslearnerswiththeopportunitytopractisereal-worldapplicationsthroughexperientiallearningParticipantsaresplitintogroupsorhouseholdsandgivenFreetoGrowmoneyandpicture

cardsomonthlyexpenses(trans-portation,ood,clothing,entertain-ment,etc),andinstructedtoallocatemoneytoeachexpenseWhentheydothis,participantsoenndthattheirmoneyisover-allocatedtolivingexpenses,leavingnothingorschoolees,aercare,andthelikeFollow-ingthisexercise,individualsaregiven

budgetsheetstohelpplantheiractualmonthlyexpenditure,withthehelpotheacilitators


18/12916

Pilottestsalloworganisationstoevaluatetheirnancialeducationmaterialsor

appropriateness,relevance,andeciencyPopulationCouncilconductedpilottesting,

whichledtotheneedtondmorecost-eectivemechanismstodeliveritsnancial

educationprogrammesinordertosupportbetterscalabilityandsustainabilityorthe

programmespartnernancialinstitutions

Manyotheorganisationsinthisreporthighlightedtheimportanceoappropriateand/or

relevanteducationalcontentortheirnancialeducationprogrammesExperiencetodate

suggeststhatthedevelopmentandadaptationothenancialeducationcontentisone

othemostdicult,yetmostimportant,tasksinensuringqualitycurriculumSeveral

organisationspointedouttheneedortechnicalexpertisewhenadaptinganancial

educationcurriculum,originallydevelopedorgeneraluse,ortheirtargetaudienceThis

requiresmodiyingtheormatandcontent(eg,illustrations,anecdotes,andexamples)to

refectthecapacityandculturalrealitiesothetargetaudienceAparticularlychallenging

componentotheadaptationprocessistailoringthecurriculumtoaccommodatevaryingdegreesoliteracy(inbothreadingandmath)andincomelevelsamongthetargetaudience

Theexperiencesoanumberotheorganisationsinthisreportunderscoretheimportanceo

providingnancialeducationtonancialservicesstaWhilethemajorityothediscourseand

actionaroundnancialeducationocusesontheconsumer,SPEEDGhanaandAMFIUactively

trainedbotheldocersandnancialeducationtrainersinnancialmanagementThey

undertookthesetrainingprogrammeswithabeliethatbybecomingmoreknowledgeableon

nancialmanagementtopics,eldocersandnancialeducationtrainerscouldservetheir

clientsmoreeectivelyBylearningthesamenancialeducationmaterial,theymaybemore

empatheticandsensitivetotheclient,

whichmayhelpthemallayanydistrust

anduncertaintyregardingMFIsthat

theirclientsmayharbour

Pedagogyisasimportantasthecontent

othenancialeducationprogramme

Manyothenancialeducationprogrammesinthisreportarebased

onprinciplesandpracticesthatemphasize

interactivelearningRelatedtothisisthe

opportunityorclientstopracticetheir

newly-acquirednancialskillsinorderto

turninormationlearnedintotangible

nancialdecisionsInthisregard,MFIs

AMFIU(AssociationoMicro-nanceInstitutionsinUganda)usesavarietyodeliverymethodsincludinganeducationalradioprogramwithintegrativeelementstoencourage

publicparticipationAMFIUselectedradiostationsthatreachouttoadiverserangeopeopleAnimpactstudyshowedasignicantincreaseinnumberoclientsandnumberodepositsatasampleonancialinsti-tutions

8

KStack(2008)AdultLearningPrinciplesandCurriculumDesignorFinancialEducation(WashingtonDCMicronanceOpportunities)


19/12917

andbanksthatdelivernancialeducationhaveadistinctadvantageParticipantsintheir

nancialeducationprogrammescandirectlyandimmediatelyexercisenew-oundnancial

capabilitiesandarethusmorelikelyretaintheskillsandknowledgeThevalueoaction-based

learningispresentinFreetoGrowsnancialeducationprogrammewhereitsparticipants

createactualday-to-dayhouseholdbudgetsThesameoccursinPEDNnancialeducation

programme,wheretheprogrammeparticipantsarerequiredtomeetweeklysavingsgoals

6. FINANCIAL EDUCATION DELIVERY CHANNELS

Programmeobjectives,targetaudiences,andpracticalconsiderationsinfuencethechoice

odeliverychannelsBroadly,thedeliverychannelsusedbythecasestudyorganisationsall

intothreegroups

.Face-to-acetraining,

.Massmedia,and

.Tools

Face-to-acetrainingisthemostcommondeliverychannelusedbytheorganisations

proledinthecasestudiesFace-to-acetrainingallowsacloserelationshiptodevelop

betweentheorganisationandtheparticipantThecasestudyorganisationsthatutilize

ace-to-acetrainingseethistrainingmethodasaneectivetoolorimprovingbehavioural

outcomesWhendistrustandearimpedetheuseobranchlessbankinginstruments,such

asATMsandpre-paidcards,directtrainingisauseultooltoaddressthischallengeFINCA

Mexicousesace-to-acetrainingtobuildtrustortheuseopre-paidcardsthrough

relationshipbuildingandrole-playing

Organisationsalsodelivernancialeducationthroughmassmedia,suchastelevision,public

campaigns,roadshows,andradioprogrammesFinancialeducationprogrammeswiththe

ultimategoalopromotinggeneralawarenessonancialliteracyissuesoenuseradioor

televisiontoreachaudiencesRadioprogrammes,moresothantelevision,areeectiveat

reachinglow-incomeaudiencesWhilemassmediahastheabilitytoreachlargenumbers

opeople,theimpactosuchprogrammesonlong-termnancialbehaviourchangehasnot

beenassessedandislargelyunprovenThus,theuseomassmediatodelivernancial

educationprogrammesrequiresurtherinvestigationbeoreconclusionscanbedrawnaboutitseectiveness

Tools,suchasbrochures,fyers,posters,ortrainingvideos/DVDs,oerenormouspotentialto

lowertheperpersoncostodeliveringnancialeducationprogrammesTheinitialexperiences

oFauluKenyaandOIBMshowthattrainingvideos/DVDsmayalsobeaneectivetoolto

encourageconversationandstimulateexcitementaroundnancialeducation


20/12918

Manyothenancialeducationpro-

grammesinthisreportuseedutain-

ment,oreducationalentertainment,to

engagetheiraudiencesTheatreand

danceproductions,radioshows,televi-

sionprogrammes,comicstrips,andother

outletshaveprovenhighlyeectiveat

impartingnancialeducationmessages

tolargeanddiversegroupsopeople

Edutainmentprogrammesalsoexpose

newaudiencestonancialeducation

messagesEdutainmentcanreachthose

withoutaccesstomoretraditional

educationaloutlets,suchastraining

coursesorworkshops

Animportantelementtoconsider,

whendecidingontheappropriate

nancialeducationdeliverychannelor

aprogramme,isthesocio-economic

characteristicsothetargetaudience

Theseincludeeducationallevelsand/orgeographiclocationsForexample,ruralpopula-

tionsmanyowhommayhavelimitedornoormaleducationpreerlearningincommunal

environments,suchasgrouptrainingclassesorstudycirclesBycontrast,marketresearch

showsthaturbanpopulationspreerone-on-onecounsellingorconversation-stylelearning

environmentsInMongolia,literacylevelsareveryhighandclassroomstylelearningisa-

vouredKnowingthis,XacBankdesigned

aclassroom-basedprogrammetoreach

adolescentgirls

Peopleretainnewknowledge,skills,

andattitudesbestwhentheinormationpresentedisrelevanttothemForJA

Nigeria,theexistingschoolenvironment

oersteachablemomentsJANigerias

nancialeducationprogrammereaches

youngpeopleatapointintheirlives

whentheyaremostcomortablelearning

inaclassroomsettingThisisnotneces-

sarilyappropriateoranoldergroup

JuniorAchievement(JA)Nigeriausesexistingschoolandcommunitygroupsasaplatormtoreachlearn-ersJANigeriaocusesonscalingupitsexistingprogramwithinschoolsbyincreasingthenumberostudentsperclass(uptoamaximumnumber),andthenincreasingtherequencyoclassesheldintheestablishedschools,andnallybyaddingnewlocations

XacBankistheourthlargestbankinMongoliaserving,bor-rowersand,savers(MixMar-ket,00)Inearly009,XacBankpartneredwiththeNikeFoundation,WomensWorldBanking(WWB),andMicronanceOpportunities,andde-velopedTemuulel(meaningAspire),asetocustomizedsavingsproductslinkedtoanancialeducationpro-gramor-yearoldgirlsFromthebanksperspective,nancialliteracygivesconsumersthetoolstotake

maximumadvantageothebanksproductsAdditionally,nanciallit-eracyorgirlsisseenasalongterminvestmentinautureclientelethathopeullywillbeloyaltotheBank


21/12919

PracticalconstraintsoenposechallengeswhenchoosingalternativedeliverychannelsFor

example,anorganisationmayrealizethatDVDsandradioprogrammesareeectivemeans

toimpartnancialeducation,buttheremotelocationotheirtargetaudiencemaylimitor

preventaccesstobankbranches,centraltransportationcentres,orradiosignalreach,where

nancialmessagescanbebroadcast

Anotherissueisattractingthenecessaryundingtocoverthecostsodeveloping,delivering,

andimplementingthenancialeducationprogrammeWithoutadequatenancialresources,

organisationsmaybeorcedtoselectalesscostlyandpossiblylessdesirabledeliverychannel

optionThecasestudieseaturedinthisreportshowthatorganisationsoendonotconsider

thisrealityintheinitialstagesoprogrammedesignanddevelopmentOen,onlyaerthe

initialinvestmenthasbeenmadetodevelopaspecicnancialeducationcurriculumandits

deliverychannel,dotheorganisationsrealizethattheylacksucientresourcesorprogramme

rolloutandull-scaleimplementation

7. WHAT WORKS IN FINANCIAL EDUCATION

Todate,therehasbeenlimitedinormationavailableonthekeyactorsorsuccessin

nancialeducationprogrammesManyotheorganisationsproledinthecasestudies

communicatedtheirrecognitionothischallengeTheycitedalackoundingormonitoring

andalackoevaluationsystemsasconstraintsthatlimitthequantityanddeptho

inormationavailableTheselimitationscaninhibitthesuccessulscaleup,sustainability,

andultimateimpactonancialeducationprogrammesIndeed,ewothecasestudy

organisationshavenancialeducationmonitoringprocessesinplaceIninstanceswhere

organisationsevaluatetheirprogrammes,theyoenocusonlyonoutcomesachieved

Useulindicatorsincludepre-andpost-testdatatomeasuretheacquisitionoknowledge

andskills,uptakeoproductsandservices,anddecreaseoindebtednessDespiteitsearly

stage,thenancialeducationindustryhasmuchtolearnromprocessevaluationsThese

evaluationscanidentiyimportantinsightsintothemechanicsoimplementingnancial

educationprogrammes

7.1 WHAT IS SCALE IN FINANCIAL EDUCATION PROGRAMMES?

OrganisationswithnancialeducationprogrammesoenhavedierentapproachestoscaleThevariationsrefecteachorganisationsobjectivesoritsnancialeducationsprogramme

Thecasestudiesinthisreportpointtoourmainroutestoreachingscale

National/regional consumer education campaigns These programmes have a lowcost per person and expose large numbers o the public to key messages. Unortunate-

ly, due to the nature o the delivery channel, quality monitoring and evaluation data is

very dicult to obtain.


22/12920

Financial service providers Financial service providers existing clients oer animportant base or rapid scale-up o nancial education programmes. From a users

perspective, having simultaneous access to nancial services and a nancial education

programme enhances practical learning. From an organisations perspective, nancial

service providers can utilize their existing inrastructure and resources to deliver

nancial education programme to large numbers o people.

School-based programmes Using pre-existing platorms to reach groups o youngpeople provides considerable opportunities to scale. Organisations like PEDN and JA

Nigeria have achieved this by building school-based strategies to leverage existing

networks, and by using standardized content and delivery channels to manage costs.

Personal development and training Direct training programmes allow additionalinteraction with participants. In order to deliver training eectively, the programmes

also require specialised or complementary platorms, vehicles, or agendas. This degree

o customization can challenge the programmes ability to achieve scale.

7.2 WHAT FACTORS FACILITATE SCALE?

Inadditiontotheourroutestoreachingscaleabove,thecasestudieshighlightotherkey

actorsthatpromoteorinfuenceeectivescaleup

Partnerships and networks The majority o the case studies eatured in this reportsuggest that stakeholder involvement (government, nancial service providers, or

other) is undamental or scaling up nancial education programmes. These partner-ships can serve various purposes:

oTheyprovidenancialsecurityinsup-

portoexistinginrastructure,networks,

andcapacity

oParallelpartnershipsbetweennancial

educationandnancialserviceproviders

ensurethatknowledgeimpartedto

participantsislinkedtoopportunitiesto

exercisenewly-acquiredskills

oDecentralizationodeliverywithin

nancialeducationorganisationsmay

acilitate

networkingbetweengroups,sharingo

inormation,andspreadingpositive

externalities

FauluKenyahasoundthatitismoreeectiveorthemtobeaullservicenancialinstitution,oeringmorethanjustloansTheyhaverecentlyaddedsavingsand

transactionalproductstotheirclientservicesoeredFauluhasembed-dednancialeducationintheprovi-siononancialservicesaspartotheirbusinessmodelTheBankseesnancialeducationasawaytoassisttheirclientsisusingFauluservicesmoreappropriatelyandwisely


23/12921

Use o mass media and technology Mass media and the use o technology areincreasingly popular channels or disseminating nancial education programmes

more widely. Organisations using technology or the delivery o nancial education

programmes may initially incur substantial development costs. Yet, in the long run

they should achieve a more ecient cost structure due to the lower operating costs.

Resources, such as radio and television, can reach multiple end users. Faulu developeda set o DVDs, based on a local popular television series, to use in trainings as well as

on-line courses. Radio programmes, sponsored by AMFIU and SAIA, reach audiences

that cannot access traditional workshops. Also, the use o mobile phone applications

as a delivery channel or nancial education programmes is likely to increase rapidly as

mobile banking expands.

Institutionalization According to the organisations eatured in this report,nancial education should not be a one-time occurrence, but an integral component

o an organisations ongoing interaction with its community and clients (such as a

clients relationship with an MFI or bank).

7.3 WHAT ARE THE COSTS INVOLVED IN FINANCIAL EDUCATION?

Generallythecostsoimplementationcan

bebrokendownintotwomaincategories

.Programmedesignanddevelopment

(eg,nancialeducationmessages,

modules,etc);and.Disseminationonancialeducation

(eg,training,learningevents,andother

models)

Thecostsonancialeducation

programmes,particularlyororganisations

thatincorporatenancialeducationintoa

broaderprogramme,canbediculttoquantiy

Ideally,byidentiyingthetotalcostsineachcategoryaboveanddividingthisgurebythe

numberopeoplereached,oneshouldbeabletoestimateanaverageunitcost(ie,cost

perpersonaccessingthenancialeducationprogramme)However,inpractice,andinthis

report,thiscalculationisdiculttoreachandattimesimpossibletouseorseveralreasons

Detailed nancial inormation is sparse and ofen entirely unavailable, even rom thecase study organisations.

PopulationCouncilisaninterna-tional,nonprot,non-governmentalorganisationspecializinginresearch

anddevelopmentaroundpopulationhealthissuesTheCouncilengagesothermorespecializedinstitutionstoassistitindevelopingandimple-mentinganancialeducationpro-grammethatsupportsandtstheirmainstreamactivities


24/12922

Where costs are available, organisations ofen reer to the total cost o their broadconsumer education or nancial services programmes, without isolating the specic

expenditure on the nancial education component.

Organisations ofen do not know the exact number o people reached by theirnancial education programmes (particularly the TV-radio broadcasts or edutainmentcampaigns), making a cost-per-client calculation dicult.

For many o the nancial education programmes, the costs vary over time and overdierent stages o implementation. This makes it particularly dicult to aggregate

costs or programmes that are still at an early stage o operation.

Theanalysisinthisreportshowsthatprogrammedevelopment(includingmarketresearch,

educationmaterialdevelopment,andpilottesting)oenincursthehighestcostAsaresult,

thechoicesoeducationmaterialdesignanddeliverychannelinfuencethewayinwhich

organisationsreachscaleItmaybemore

eectivetoreachagreatervarietyo

targetaudiencesbyusingacombination

omultiplenancialeducationdelivery

channels,althoughitmaybemoreex-

pensivethanrelyingononlyonechannel

Thecasestudyorganisationsidentiyseveraltacticsthatdecreaseprogramme

costsAmongthemissimpliyingthe

nancialeducationmaterialsAprojects

abilitytodevelopeasy-to-understand

andeasilyreplicablelearningmaterials

mayeectivelycontributetolower-

ingthecostsothenancialeducation

programmeConversely,resource-heavy

materialsareoencostlyanddicultto

deliverindierentsettingsTechnology-

basedstrategiescanoeranumberoprospectsorloweringtheoperatingcostsonan-

cialeducationThenancialeducationprogrammeseaturedinthisreportdonotexhibit

thesetechnology-basedstrategies

Manyothecasestudyorganisationssuggestthatstakeholderinvolvementmayimprove

theeciencyonancialeducationprogrammesThroughstakeholderinvolvement,roles

andresponsibilitiescanbedelegatedtopartners,basedontheircomparativeadvantage

SPEED(SupportProgramorEnterpriseEmpowermentandDevel-opment)Ghanaemploysasuccess-ulpartnershipmodeltoacilitateawidespreadnancialeducation

initiativeSPEEDGhanawaspartoajointcollaborationwithinternationaldonors,theBankoGhana,GhanaMicroFinanceInstitutionsNetwork(GHAMFIN)andtheMinistryoFinanceandEconomicPlanning(MoFEP),plusothers,toleveragenancialsupport,inrastructure,andhumancapacitytodeliverquality-

nancialeducationacrossthecountry


25/12923

OIBMadvocatesthedecentralizationodeliveryinordertolowerprogrammecostsThis

hastheadvantageoallowingclientgroupstonetworkwitheachotherandtoshareinor-

mationOtherorganisations,likeSAIA,believethatidentiyingtheirorganisationallimitations

iscrucialSAIAviewsoutsourcingasthemostviableandecientmethodorthesuccessul

implementationonancialeducationprogrammes

7.4 HOW DO FINANCIAL EDUCATION INITIATIVES DEFINE SUSTAINABILITY?

Generally,organisationsdenesustainablenancialeducationprogrammesasthosethat

canbesuccessullycontinued,evenaerexternalundingiswithdrawnThemajorityo

organisationseaturedinthisreportcurrentlyrelyondonorundingtoimplementtheir

nancialeducationprogrammesTheseorganisationswillhavetodevisemodelsthatcan

sel-generateundsorsecureotherpermanentsourcesoundingtoensurelongevity

Long-termundingmodelsarepossible,giventhatmanyorganisationsseenancialeducation

aseitherkeytotheirbusiness(MFIsandbanks)orcentraltotheirmandate(industryassocia-tions)Thepublicationoimpactdatathatdemonstratesthevalueaddedbynancialeducation

isessentialtoensuringthatorganisationsstaycommittedtoachievingtheirobjectives

Organisationsalsoemphasizetheimportanceoinstitutionalsustainability,ormemory,

topreservethecontinuityolearningintheorganisationManyorganisationsareinitially

scepticalonancialeducationanditsbenetsXacBankacedanunchartedareawhenit

decidedtooeranancialeducationprogrammeocusedonadolescentgirlsToday,itis

committedtoanancialeducationprogrammeoryoungpeople,emaleandmaleTheim-

pactoXacbanksprogrammehasspreadbeyondthebanktonon-nancialinstitutionsand

reachesbeyondtheMongoliascapitalcityintoruralareas

Theanalysisheresuggeststhatsustainableprogrammesaredesignedaroundstrong

undingmodelsthatservenotonlytheneedsotheparticipantsbutultimatelybenetall

stakeholdersAchievingthismeanscontinualcommitmenttolearning,tobuildingcapacity

ostaandassociatedorganisations,andtocreatingandosteringpartnerships

7.5 WHICH SOLUTIONS HELP SUSTAIN FINANCIAL EDUCATION?Thesustainabilityoanancialeducationprogrammeisdirectlylinkedtotheundingmodel

andthedemandorsuchinormationbythetargetaudienceThereviewothecasestudy

organisationsidentiesthreeundingmodelswithinherentsustainability

.Prot-drivenprogrammesorservices(eg,FreetoGrow,whichchargesoritsnancial

educationtrainingsessions)

.Financialeducationsubsidisedbythenancialservicesproviderasavalue-added

componentotheirbusinessmodel(eg,OIBM,Faulu,XacBank)

.Financialeducationasavehicletoinfuencethemarket

(eg,SAIA,AMFIU,SPEEDGhana)


26/12924

Eachothesethreegeneralmodels

canleadtolong-termsustainabilityTo

nancialinstitutionssuchasFaulu,OIBM,

XacBank,nancialeducationisseenasa

value-addedservicethatboostsexisting

businessTheorganisationseaturedin

thisreportbelievethatnancialeduca-

tioncanboostexistingbusinessbyin-

creasingcustomerawarenessandloyalty,

andbypromotingtheuseoitsnancial

products

Long-termsustainability,andtheability

todemonstratevalue,ultimatelydepends

ontheeectivenessoaprogrammeFinancialinstitutionscaneasilyreachlargenumbersopeople;however,theyneedtoseean

immediatebenet,suchasincreasedproductuptakeoranimprovedimageotheinstitu-

tionWhenthesebenetsareapparent,thenancialinstitutionsaremorelikelytocontinue

oeringtheirnancialeducationprogrammesoverthelongtermWithoutsuchbenets,

theyareunlikelytocontinueoeringnancialeducationprogrammes

Fornancialeducationtobeeective,itmustbeappropriateandpracticalorthetarget

audienceUnderstandingtheclientbaseortargetaudienceiscriticaltothesuccessul

implementationoanancialeducationprogrammeOrganisationsneedtoembracea

thoroughprogrammedevelopmentprocessThisbeginsattheinceptionphase,gathering

inormationonpotentialparticipantscurrentnancialbehavioursanddesiredbehaviours

viaworkshops,stakeholderorums,andinormaldiscussions,amongothersTheprocess

continueswithpre-andpost-trainingsurveys,andextendstolaterassessmentsoclients

behavioursFurther,organisationsneedtoreviewandreviseprogrammesregularlytoensure

thatthematerialsandcurriculaaremeetingthechangingrequirementsotheaudience

Thismeansthatongoingclientsurveysarenecessaryandvital

7.6 ENHANCED IMPACT: WHAT IMPROVES FINANCIAL EDUCATION UPTAKE?

Theorganisationsparticipatinginthisreport,viatheirownmonitoringandevaluationactivi-

ties,understandthattheirclientsgainnumerous,positivebenetsasaresultotheirnancial

educationprogrammesOrganisationsdirectlyattributetheincreaseinthenumberobank

accounts(eg,SPEEDGhana)andthenumberosavers(eg,AMFIU,OIBM),aswellas

changesinclientsselesteem(PopulationCouncil),totheirnancialeducationprogrammes

However,limitedobjectiveevidenceispresentedtosupporttheirassertionsWhiletheseor-

ganisationsshowpromisingimpacts,alackosubstantiveproocallsorurtherinvestigation

FinLit,arelativelyneworganisa-tion,seestargetmarketanalysis,pro-gramreview,andimpactevaluationascriticalcomponentstothelong-termrelevanceandsustainabilityotheorganisationFinLitsconstantsurveyisandmarketanalysesledittoadjustitsprogramtokeeptheirtopicsappropriateandcurrentTheresultwasadoublingoattendanceatFinLitsAnnualFinancialLiteracyWeek


27/12925

Research,too,canhelpdeterminewhatotheractorsmaybeinfuencingtheincreaseinsavers

Anexampleoapossibleactorisaggressivemarketingeortsbytheinstitutionstopromote

theirproducts,whichmaybecontributingtoanincreaseinthenumberosavers

Unortunately,itisnotpossibletocomparethedataprovidedbytheorganisationsbecause

thereislittleconsistencyinhowthedataisgatheredandanalysedHowever,itispossible

toconcludethatmanynancialeducationprogrammeshaveincreasednancialproduct

uptakeandimprovedattitudestowardnancialmanagementFiguredisplayssomeothe

indicatorsthatthecasestudyorganisationsusetodemonstratetheimpactotheirnancial

educationprogrammes

Impactwithregardstoimprovingknowledge,skills,attitude,andbehavioursislargelyde-

pendentontheeectivenessothenancialeducationcurriculum,mechanismodelivery,

teachers,andopportunityorapplicationSkillsandknowledgeshouldberealisticallyand

practicallyrelatedtothesocio-economiccharacteristicsothetargetaudienceToac-

complishthis,nancialeducationprogrammesneedtoaccountorrelevantcultural,social,

geographic,andeconomicactors,aswellasagesandstagesolieothetargetaudiences

Allarecriticalconsiderationsorimpartingknowledgethatparticipantscanuseandapply

toimprovetheirlivelihoodsThus,thereareourkeyactorstosuccessulnancialeducationprogramming

.Qualityandrequencyothenancialeducation

.Relevanceothenancialeducationtothetargetaudience

.Opportunitytoapplythisnancialeducation

.Location/contextwherepeoplecanexercisetheirnewnancialbehaviours,suchas

accesstoappropriatenancialproductsandservices9

ORGANIZATION OBJECTIVE INDICATORS

AMFIU Consumer protection andawareness initiative

69.6% increase in number o respondents holding savingsaccounts

66.2% increase in the number o people reporting it is pos-sible to save

OIBM Product uptake and improvedproduct use

From 40,000 savers in 2005 to 260,000 in 2010

FreetoGrow Personal skills and develop-ment or improved livelihoods

54% increase in the number o participants who reportedsaving

96% o participants reporting that their nancial situationhas improved

FIGURE 2 IMPACT MEASUREMENT FOLLOWING FINANCIAL EDUCATIOIN

9HighlightedinGrayetal(2009)


28/12926

Contextspecicityiscrucialtothe

uptakeandrelevanceonancial

educationprogrammes,andisalsoone

otheprimaryobservationsothisreport

Itscorollary,however,isthatitalsocan

beanobstacletodrawingbroadlessons

aboutnancialeducationpracticesthat

canbeappliedinothercontexts

However,whatisclearisthat,across

allcontextsandsituationseaturedin

thisreport,nancialeducationismost

eectivewhentheindividualmotivations

otheparticipantsarecombinedwith

communitysupportByinvolvingentire

socialgroups(evenindirectly)innancialeducationprogrammes,thebenetsoenhancednancialcapabilitymayhavear-reachingspill-overeects

OtheractorsmayalsoplayaroleinsuccessulimplementationAnumberothecase

studyorganisationshighlighttheimportanceoconsolidatingandstreamliningnancial

educationactivitiesversusorganisingtheminormallyorusingadhocmethodsFinancial

educationprogrammesshouldbuildonexistinginrastructureornetworksSPEEDGhanais

anexampleousingpartnershipstoboostimpactOvertimeandwithconcertedattention,

itsnancialeducationprogrammehasbecomearoutineexerciseanditspartners(MFIs,

governmentagencies,andpublicadvocates)speakthesamelanguageSAIAspartnership

withtheFinancialServicesBoardinSouthAricaurtherdemonstratestheimportanceo

aligninglocalandnationalnancialeducationinitiativesinordertoachievesignicantimpact

Duetheinherentlimitationsothisresearch,thisreportallsshortinprovidingevidence

thatnancialeducationactuallycausesimprovedwell-being,perseHowever,thecasestud-

iesdosuggestthatcertainactors(asdetailedabove)contributepositivelytothesuccessul

absorptiononancialeducation,andarethusimportanttoconsiderinimplementingand/or

evaluatingnancialeducationprogrammes

Finally,itiscrucialtonotethatnancialeducationmaynotconquerthevariousother

challengesdestabilisingthesegroups,suchaspoorhealth,crime,orriskybehaviours

Thereore,nancialeducationshouldnotbeseenasapanaceaorallsocio-economic

problemsprevalentinthesegroups,butratherasavaluablecomponentoabroader

educationalcurriculum

FinLit,arelativelyneworganisa-tion,seestargetmarketanalysis,pro-gramreview,andimpactevaluationascriticalcomponentstothelong-termrelevanceandsustainabilityotheorganisationFinLitsconstantsurveyisandmarketanalysesledittoadjustitsprogramtokeeptheirtopicsap-propriateandcurrentTheresultwasadoublingoattendanceatFinLitsAnnualFinancialLiteracyWeek


29/12927

8. CONCLUSION

Theorganisationsreviewedinthisreportexplorediverseapproachestoimplementing

nancialeducationorlow-incomepopulations,primarilyvulnerablegroupssuchaswomen

andyouthThenancialeducationprogrammesreviewedherehighlightanumberokey

practicesthatbothaidandimpedesuccessul,sustainable,high-impactnancialeducation

However,thenewnessomanyotheprogrammesmeansthatlong-termresultsmaynotyet

beapparent,specicallyorprogrammesaimingatbehaviourchange

Whatisclearromthisreport,anditsaccompanyingcasestudies,isthatitisearlydaysin

theeldonancialeducationorlowincomepopulationsMuchowhatishappeningnow

isbothexploratoryandexperimentalWearearromknowingwhatgoodpracticeis,let

alonebestpracticesinnancialeducationBuildingnancialcapabilitieswithadiversearray

onancialeducationtoolsoersarichchoiceovalidpathwaysoradvancingboththe

nancialinclusionagendaandthesocialdevelopmentagendaHowever,likeallbehaviour

change,thisprocesswilltaketime

Onestrategyorinterestedundersshouldbetopushtheenvelopetowardabetter

understandingowhatmakesnancialeducationeectivethewhen,thewhat,andthe

howBut,investinginnancialeducationshouldbemorethanpayingorganisationstotry

newthingsorimprovewhattheyaredoingFundingshouldalsoincludegatheringreliable

datathatcanhelpthesectorasawholeunderstandhowtoeectivelyrolloutnancial

programmestoscaleIourgoalistomovetowardevidence-basedprogramming,then

investmentsinevaluationwillbevitalWehaveawaytogoinallaspectsoour

determinationtobuildnancialcapabilities,butweareontherighttrack


30/12928

APPENDIX

A. OIBMOPPORTUNITY INTERNATIONAL BANK OF MALAWI

InstitutionalBackground

OpportunityInternationalBankinMalawi(OIBM)isthelargestcommercialmicronance

bankinMalawiAccordingtoitsmissionstatement,itprovide[s]high-valuenancial

servicestomeettheneedsoeconomicallydisadvantagedMalawianswhoaretraditionally

underservedbytheMalawianbankingsector 0 OIBMusesbothgroupandindividual

lendingmethodologiestooernancialproductsandservices,includingloans,savings,

paymentservices,andoreignexchangeproductstotheeconomically-activepoor,to

wealthyindividuals,andtocorporationsacrossMalawiOIBMultimatelyhopestoreach

theunbankedpopulationandacilitatetheiraccesstoOIBMsormalnancialservices

OIBMsoperationshadocusedonurbancentersuntilmid-00,whenitbeganexpandingintoruralareasAsoOctober00,OIBMservesapproximately0,000activeloan

clientsandhasanoutstandingloanportoliooUS$millionOIBMhasmobilizedUS$

millionindepositsrom00,000depositorsTogetherwithitsnancialproducts,OIBM

oersnancialeducationtohelpimprovethemoneymanagementskillsoitsclients,

employinganumberostrategiestodeliveritSincetheinceptionoitsnancialeducation

programmein00untilOctober00,OIBMreachedroughly,000people

TargetAudience

OIBMcurrentlyhasapproximately0,000clients,owhich%areyoungadults

yearsoageMostoOBIMsclientsareemployedintheinormalsector,andmanydepend

ondailyincomeorsurvivalExposuretoormaleducationislow,only%oclientshave

someyearsoormaleducationandtheremaining%oclientshavenoormaleducation

Inruralareas,ormaleducationlevelsareevenlowerthanurbanareasOIBMservesboth

ruralandurbanclients;however,almost%oitsoutreachistoruralclientsMostothe

individualstargetedbyOIBMhavelittleornointeractionswithormalnancialinstitutions,

thisisespeciallytrueinruralareas,asshowninFigure

Thelowuseoormalnancialservicesisaresultoalackoaccess,especiallyintherural

areas,aswellascommonlyheldnegativeperceptionsoormalnancialinstitutionsMost

Malawianstransactwithrelativesandneighbours,saveathome,andoenexperience

dicultybudgetingtheirincometomonthendKeycharacteristicsotheOIBMtarget

audienceincludepovertyandmistrustoormalnancialinstitutions,coupledwithalack

omoneymanagementskills

10OIBMwebsite(2009)MissionRetrievedJune2011wwwoibmmw11

EMcGuinness(2008)MalawisFinancialLandscapeWhereDoesOpportunityInternationalBankoMalawiFit?AssessingtheImpactoInnovationGrantsinFinancialServices(WashingtonDCMicronanceOpportunities)


31/12929

12(N=145)FromaMicronanceOpportunitiessurvey(2008)

FinancialEducationBackground

OIBMlaunchedanancialeducationprogrammeinearly00inaneorttoincreaseits

clientsknowledgeomoneymanagementskillswiththeultimategoalobringingpotential

customersintothenancialsector,namelytoOIBMTheprogrammeoeredbusinessand

loanrepaymenttraininguntil00whenOIBMdecidedtoaddbasicnancialeducation

toaugmentitsoriginaltrainingocusOIBMbelievedthatnancialliteracyskillswould

maximizeopportunitiesorinclusioninthenancialmainstreamandattractthetarget

audiencetoOIBMsnancialproducts

Atrst,OIBMocuseditstrainingsolelyondebtmanagementThesetraininglessonswere

apartoregularmonthlygroupmeetingsbetweenclientsandcreditocers,andcentred

primarilyontheimportanceorepayingloansontimeAsOIBMexpandeditsoutreach,it

realizedthatthisocusoncreditwasnotsucienttobuildeithermoneymanagementskillsorengenderasenseoloyaltyintheircustomers(seeFigure)Despitethedebtmanage-

menteducation,OIBMsclientscontinuedtohavedicultyrepayingtheirloansontime

OIBMcametotheconclusionthat,withoutachangetoitsnancialeducationprogramme,

clientswouldnotbecomegoodborrowersandOIBMwouldnotbeabletoreachitsgoalo

increasingthenumberodepositswiththebank

80

Percentage of Respondents

70605040302010

Used Formal Financial

Have Any Savings

Have Formal Savings

Save At Home

Belong To ROSCA

Have Outstanding Loan

Have Formal Insurance

0

Institutions in Past Year

FIGURE 3 REPORTED USE OF FINANCIAL SERVICES IN MALAWI, 200812


32/12930

Institutionalperormancegoalsareimportantwhenintroducingnancialeducation

Ononehand,nancialeducationishelpingpeoplegainknowledgeonnancial

matters,butontheotherhand,helpingtheinstitutionbecausetheborrowersare

lessrisky,theybecomeyourgoodbet!

OIBM interview, 2009

Basedonitsprogrammeexperiences,OIBMrecognizedthatitsclientswouldnotseethe

valueonancialeducationunlessitwaspertinentandrelevanttothemAsaresult,OIBM

nowstronglyemphasizestheimportanceodevelopingdemand-drivennancialeducation

programmesByhelpingitsclientsseethedailyapplicabilityothenancialeducation,they

aremorewillingtoattendthesessions

FinancialeducationneedstobedemanddrivenPeoplewillnotbuyintosomethingiitisnotpersonallyapplicabletothemTheeducationhastomeetourneeds,but

alsotheneedsoourclientsWeconductedocusgroupdiscussionsandobserved

clientbehaviourItwasclearthattheyreallylackednancialliteracy,hence,weintro-

ducedit

OIBM Interview, 2009

Currently,OIBMsnancialeducationprogrammecontentocusesonissuesobudgeting,

savings,anddebtmanagementOIBMregularlyconductsclientmeetingsaboutitsnancial

educationcurriculumtoensurethatthetopicsmeetthechangingneedsoitsclientsand

themarket,aswellasthechangingneedsoOIBM

FinancialEducationModel

OIBMsnancialeducationprogrammeconsistsoamixomultimedia(DVDsandradio)

inormationdeliveryandindividualtrainingmeetings(one-on-onecoaching)Thesedelivery

channelsreachdierentmarketsegmentsandaccommodatethedierentlearningneedso

theclientstheytarget(Figure)Financialeducationtrainingmeetingsarepredominantly

13FromOIBM(2009)

FIGURE 4 FINANCIAL EDUCATION HISTORY 13

Montlytrainnings usingOI materials.FinacialEducationlessons ocusedmostly on debtmanagement.Focus borrowers

Montlytrainnings butstarted to useMFO Budget-ing and SavingsmodulesFocus borrowers

Change rommontly toquarterlymeetingsFocus allOIBM clients(savers andborrowers)

FinancialEducation usingmultimedia(DVD) in 4 keylocations:Lilongwe,MuzuzuKasungu andBlantyre

OIBM startedoperations inCentralprovince.

00 00-00 00 Jan00 June009


33/12931

usedinareaswhereOIBMoersgrouploanproductsIntheseareas,OIBMdelivers

nancialeducationthroughanexistingnetworkogroupsBecausethegroupsmeetona

regularbasis,organizingtrainingclassesisrelativelyeasyandcosteectivethetrainingcan

bescheduledeachtimethegroupmeets

AtypicalOIBMclientisexposedtotohoursonancialeducationtrainingannually

ClientsreceivebrienancialeducationtrainingwhentheyjoinOIBM(0minutes),as

wellasduringmonthlymeetingswithcreditocers(00minuteseachmonth)The

greatestintensityonancialeducationoccursduringquarterlynancialeducationtrainings,

conductedbynancialeducationtrainersThesequarterlytrainingslasthours

OIBMcreateditsnancialeducationDVDsprimarilyoritssavingsclientsWhileace-to-

acetrainingisaneectivewaytoreachborrowers,inOIBMsexperience,itisnotasuseul

orreachingsaversSaversvisitbankslessoenanddonotattendcreditmeetingsWithout

structuredandrequentinteractions,OIBMdoesnothaveasclosearelationshipwithsavers

asitdoeswithborrowersAttractingsaverstotrainingsprovedtobedicultandcost

inecient,intermsotimespentorganizingthetraining,orOIBM,Consequently,OIBM

decidedtodevelopnancialeducationDVDsthattargetedsavers,especiallythoseinurbansettings,andplaytheDVDsintheirbankbranchesduringbankinghoursIn009,OIBM

conductedapilottestotheDVDsinourbranchesThepilotwassuccessulandasaresult

theDVDsweredistributedtoallbranchesin00

OIBMschoiceodeliverychannelsisurtherinfuencedbygeographiclocationFor

example,clientsinruralareasliveartherawayrombankoces,sotheirvisitsareless

requentOIBMalsorecognizesthatduetoinrequentbankocevisits,DVDsmaynotbe

FINANCIAL EDUCATION EVENT LENGTH OF TIME EXPOSED TO FINANCIAL EDUCATION

Orientation meeting (meeting conducted by OIBMbeore a client joins OIBM) voluntary

1520 minutes

Monthly meetings with credit ocer (meetingsconducted by OIBM once clients joins OIBM and hasa loan) mandatory

2030 minutes

Quarterly nancial education trainings (organized byOIBM) voluntary and ree

11.5 hours

DVDs (play during the opening hours o OIBM,8:00 a.m. to 3:00 p.m. daily)

Unknown

Radio (ocused on product marketing, but presentssome nancial advice and nancial education message)

Unknown

From OIBM.

FIGURE 5 LENGTH OF EXPOSURE TO FINANCIAL EDUCATION FOR AN OIBM CLIENT


34/12932

themostecienttoolinruralareasInaddition,thepotentialruralclientele,mostlywomen

withlittleornoormaleducation,preerstolearninagroupenvironmentinamoreinormal

settingForthispopulation,ace-to-acetrainingseemstomakemoresense

TheclientsweworkwitharemostlyilliterateTheyvaluethispersonalapproach;

theyliketoseetheaceothebankTheyliketo,howcanIsayit,touchOIBMi

youunderstandmeAndnancialliteracyallowsjustthat


WhileOIBMstillconductstrainingsinurbanareas,itadmitsthattrainingmaynotbethe

mostecientwayoreachingurbanclientsOIBMstrainingattendanceratesarelowerin

urbanareas(%),comparedtoruralareas(90%)OIBMbelievesthatthisisbecauseurban

dwellerseelthattheyhavelesstimetodevotetotrainingsOneoactorsinfuencing

attendanceatnancialeducationtrainingsisoccupationclientsinurbanareasaretypically

engagedinsmallbusinessesandarereluctanttoleavetheirbusinessesunattendedClientsinruralareasworkmostlyinagricultureandcanmanagetheirtimewithgreaterfexibilityto

accommodatescheduledtrainings

ThesuccessoOIBMseortstopromotenancialeducationthroughradioorone-on-one

contactislessclearOIBMrunsadvertisingcampaignsornancialproductsasamethod

toboostproductuptakeItbroadcastsradioshowscontainingnancialadviceonceaweek

orsixmonths(MayOctober)onMBCradioandZodiakItalsomakesindividualcounselling

sessionsavailableasabankservicetoallclientsHowever,OIBMdoesnotcurrentlyhavea

systemortrackingthesuccessorrequencyothesesessions,orordeterminingtheradio

stationslistenership

Scalability

OIBMreportsthatithasreachedapproximately,000peoplewithitsnancial

educationactivitiessince00TrainingreportsandattendancesheetsshowthatOIBM

reachedroughly,000throughdirecttrainingactivities(0000)andprobably0,000

throughtheDVDs(late00900)Basedonthereachoeachdeliverychannel,theDVDs

areclearlyamoreeectivewaytoreachscaleorOIBMnancialeducationprogrammeGivengeneralradiolistenershipdata,OIBMestimatesthatpotentiallymillionpeople

heardtheradioshows,butithasnotconductedanyspecicresearchintowholistenedto

thebroadcastsandhoweectiveitmaybeAsaresult,itsradioshowlistenershipestimate

maybeonthehighsideItissaetosay,however,thatOIBMsnancialeducationtraining

programmeoutreachnumbersareaccurate

OIBMhasmadeaconcertedeorttoincreasethenumberostaworkingonnancial

educationAsoJune00,OIBMhadateamosixpeople(ourtrainersandtwosupervisors)


35/12933

dedicatedtonancialeducation,upromourpeoplein00Theteamcurrentlyreaches

some,000clientsannually(Eachtrainerteachesapproximately,900peopleayear)

SinceOIBMisgrowingrapidly,thetrainersareunderalotopressuretoreachasmany

peopleaspossibleIncreasingscale,whilemaintainingqualityandcosteectiveness,hasits

tradeosForexample,in00OIBMshiedrommonthlynancialeducationtrainingsto

quarterlytrainingsbecauseitdidnothaveenoughstatodeliverthetrainingsAdditionally,

asthenumberoclientsgrew,OIBMhadtochangeitstrainingdeliveryFirst,itincreased

thesizeothetrainingsessionsrom00clientsto00clientspersessionSecond,

classtimewasreducedromseveralhourstoonehourtoaccommodatethetimeconstraints

oclientsandtrainers

OIBMalsoestimatesthatitallocatedapproximatelyUS$,000orproductdevelopment

toadaptnancialeducationmaterialsItconsidersthisasignicantinvestmentandhasem-

phasizedtheimportanceoincreasedproductuptaketojustiytheoutlayOIBMsexperiencesdemonstratethatoeringnancialeducationwithinanancialinstitutionisabalancingact

additionalcostsmustbejustiedtoshareholderswhilealsomaintainingservicequality

OIBMscostsorstaandproductdevelopmentroseconsiderablyastheprogramme

progressedStacostsincreasedrom%in009to%in00,whilethecosts

oproductdevelopmentroserom%in009to%in00Theseguresinclude

OIBMsnewinvestmentindevelopingthemultimediaoutlets(DVDsandradioshows)

Ultimately,thissuggeststhatOIBMcanjustiytheinvestmentinnancialeducation

programmesonlywhenitisrefectedingreaterproductsales

ThisreviewoOIBMsprogrammepointstootheractorsthatcaninfuencescalingupnancial

educationprogrammeswithinanancialinstitutionOne,OIBMneedstoinvestinexpanding

itsinternalcapacity,namely,byhiringandtrainingadditionalstaHowever,thisiscostlyand

alsomustbejustiedwithanincreaseinproductuptakeTwo,OIBMscombinationoap-

proachestoscaleupthenancialeducationprogrammeappeartobemoreeectivethani

itpursuesonlyonedeliverychannelThree,becauseOIBMhasinvestedsignicantresources

intraining,itmaybereluctanttodiscontinueitsnancialeducationtrainingorearolosingitspersonaltouchwithclients,eveniteachingtimeisreducedanditisnotthemostcost-

eectiveapproach

Sustainability

FinancialeducationisanintegralpartoOIBMsnancialservicesAsavalue-addedservice

thatleveragesexistingnancialproducts,OIBMsnancialeducationprogrammehelpsthe

bankbuildandmaintaincustomerloyaltyOIBMsprimaryconcernisthesustainabilityothe

organisation,andnancialeducationisseenasaundamentaltooltoachieveit


36/12934

OIBMsmanagementandstasharethesameenthusiasmornancialeducationThechie

executiveoceriscommittedtodevelopinglong-termresourcesornancialeducation

withinandoutsidetheorganisationIn00,thebankallocatedapproximatelyUS$0,000

ornancialeducation(comparedtoUS$,000in009),%owhichwasdonorunded

Wespendmoremoneyontheseactivitiesthananormalinstitutionwouldspend,

butthatisbecauseweseethatnancialliteracyisverybenecialtoourinstitution


ThebankhasastateamdedicatedtothenancialeducationprogrammeIthasdeveloped

standardizednancialeducationmaterialsandusestwonancialeducationdelivery

channelsTheseeorts(andinvestment)showthatOIBMiscommittedtoasustainable

nancialeducationprogramme

VARIABLEANNUAL COSTS(IN US$)

20092010

Number o people reached through training 23,882 42,000

Number o people reached through DVDs 50,000 200,000

Total actual costs or nancial education 56,667 130,000

Total allocated budget or nancial education 60,000 100,000

Dierence between allocated budget and actual costs (3,333) (30,000)

Product development costs as a % o total actual costs 27.78% 53.33%

Pilot testing as a % o total actual costs 5.56% 6.67%

Costs o monitoring as % o total actual costs 16.67% 16.67%

% o donor unding 33.33% 33.33%

Amount o money spent per individual trained orreached via DVDs

1.30 1.86

From internal OIBM data.

FIGURE 6 LENGTH OF EXPOSURE TO FINANCIAL EDUCATION FOR AN OIBM CLIENT


37/12935

2005

2006

2007

2008

2009

2010

300

250

200

150

Borrowers / Depositers (Thousands)

100

50

0

BasedondataromOIBM(Figure),theaveragecostonancialeducationprogramme

deliveryoroneindividualin009wasUS$0Thiscostsignicantlyincreasedin00to

US$perpersonDespitethisincreaseincostperperson,OIBMreachedalargervolume

oclientsin00,000people,comparedto,in009

EnhancedImpact

ThemainobjectiveoOIBMsnancialeducationprogrammeistoprepareclientstomanagetheirmoneyindierentcapacities,namely,earning,spending,saving,borrowing,

andinvestingHowever,OIBMhasrecentlybecomeinterestedinunderstandinghowits

nancialeducationprogrammeimpactsthenancialbehaviouroitsclientsOIBMis

currentlyengagedwithMicronanceOpportunitiestoconductastudyoOIBMs

participant-clientstodeterminethis

OIBMmeasuresthesuccessoitsnancialeducationprogrammethroughtheimprovement

oportolioqualityindicatorsandincreasesintheuseoitsproductsandservicesAninternal

reviewoundthatthenumberosavingsaccountshasbeensteadilyincreasingsince00(Figuresand)OIBMattributesthisincreasedirectlytoitsnancialeducationprogramme,

buthasnotprovideddatathatsupportsthisassertionForexample,ithasnotconducteda

ocusedevaluationorconsideredotheractorsthatmaybeatplay

FIGURE 7 INCREASE IN OIBMS CLIENTS, 2005 201014

14FromMIXMarket(wwwmixmarketorg/m/oibm/data)andinternalOIBMreports


38/12936

Intheabsenceoanobjectiveimpactstudy,OIBMinterviewedindividualclients,who

indicatedthattheyelttheybenetedromthenancialeducationprogrammebeyondthe

useonancialproductsTheclientsstatedthattheyhadgainedanimprovedabilityto

budgetandusemoneymorewisely,andthattheysawtheseeectsasprimaryadvantages

oattendingOIBMsnancialeducationtrainingsTheinterviewsalsooundthatthetrain-

ingsmakeclientseelappreciatedtheynotedthatnoothernancialinstitutionoersreetrainingtotheircustomersOIBMbelievesthatthiseelingobeingappreciatedislikelyto

boostclientloyaltyoverthelongterm

2

005

2

006

2

007

2

008

2

009

2010

35

30

25

20

15

Gross Loan Portfolio / Deposits

10

5

FIGURE 8 OIBM LOAN PORTFOLIO AND DEPOSITS, 2005 201015

15Ibid

DianasStoryDianaisandlivesontheoutskirtsoLilongwetowninMalawiLikemanyoherriends,DianaacesnumerousnancialchallengesinherlieSherecalls,Ihadnodisciplineinsavings,everythingImadeIspentimmediately,comemonthendIhad

nooodinthehouseDianabeganattendingOIBMscoursesonbudgetingandsavingsin00,andtheysoonbecameessentialtoDianasnancialplanningDianaexplains,Inthepast,Ispentwithoutthinkingand,attheendothemonth,IwouldhavenomoneyOnceIlearnthowtobudget,IhadasurpluseverymonthIdonotrunoutomoneyoroodnowDianaalsoeelsempoweredbyhernancialeducationlessonsSheproudlyconcludes,Beorethenancialeducationlessons,IbelievedthatpoorpeoplecannotsaveFinancialeducationhastaughtmeotherwiseIopenedasavingsaccountwithabankIsaveonaweeklybasisnow


39/12937

Conclusion

ThiscasestudyoutlinedOpportunityInternationalBankinMalawis(OIBM)approachto

nancialeducationKeycharacteristicsotheOIBMtargetaudienceincludepovertyand

mistrustoormalnancialinstitutions,coupledwithalackomoneymanagementskillsThe

goaloOIBMsnancialeducationprogrammeistoincreaseitsclientsknowledgeomoney

managementskillswiththeultimategoalobringingpotentialcustomersintothenancial

sector,namelytoOIBMOIBMusestrainingclassesandDVDsasitstwoprimarydeliverychannelsoritsnancialeducationlessonsonsavings,budgeting,anddebtmanagement

OIBMneedstoutilizeobjectiveevaluationsandstudiestodeterminethemake-upothe

audienceitsnancialeducationprogrammereachesOIBMclearlyseesthevalueo

continuallyredevelopingandadaptingitsproductsandprogrammesInadditiontokeeping

itsnancialeducationprogrammedynamicandrelevant,OIBMcandetermineimmediately

whatiseectiveandwhereitcanincreaseeciencyOIBMplacesgreatvalueinclient

loyaltyandreapsmuchbenetromoeringreeservicesandinstitutingpersonaltouches

thatclientsappreciateItalsohasappropriatelybalanceddonorunding(%)andsel-undingoritsnancialeducationprogramme

OIBMoersanumberolessonsthatmaybeuseulinawiderangeocontexts

.Financialinstitutionscanusenancialeducationasastrategytoboostproductuptake

whileincreasingcustomerloyalty

.Financialeducationtopicsmustberelevantandapplicabletothetargetaudience

Thenancialeducationcurriculumneedstobedemand-driven

.Intheeventthatoneapproachtonancialeducationisnotsuccessul,organisations

mayneedtouseacombinationoapproachestoreachdierentoradditionalmarketsegmentstosuccessullyscaleuptheirnancialeducationprogrammes,andincrease

nancialproductuptake

.Financialinstitutionscansuccessullydelivernancialeducationwithoutallingintoa

productpromotiontrapOIBMeectivelyseparatesitstrainerswhoocusonteaching

nancialeducationromitscreditocerswhoocusonproductpromotion

.Scalabilityoanancialeducationprogrammereliesonanancialinstitutionsability

tosecurenancialsupport,whethercreatingasel-undednancialeducationpro-

grammeorattractingoutsideunding

16XAC[Goldenundordevelopment]LLCandGoviinEkhlel[Gobiinitiative]LLC


40/12938

B. XACBANK, MONGOLIA

InstitutionalBackground

XacBankwasoundedin99asacommunitydevelopmentbankandmicronance

institutionastheresultoamergerothetwolargestnon-banknancialinstitutionsin

MongoliaXacbankisnowtheourthlargestbankinMongoliaXacBanksmandateisto

provideaullrangeonancialservicestailoredtolow-incomepopulationsinurbanandruralareas,suchasmicroandsmallbusinesscustomersandherders,whohavelimited

accesstoormalnancialservicesXacBankcurrentlyoerstypesoloanproductsand

dierentsavingsproducts,plusmoneytransers,paymentandleasingservices,andmobile

bankingtoacilitatethepatronageoitsremote,ruralclientsWithocesand99sta

membersinallprovincesothecountry,XacBankcaterstomorethan9,000depositors

XacBankhasapronouncedpro-youthocusItoersproductstobuildsavingsorchildren

underyearsoldXacbankrealizedthatnancialeducationcouldbeatooltoboostproduct

amongstadolescentgirls,yearsold,romlow-incomeamiliesXacbankoriginallyintendedtomeasureitssuccessbytheincreaseinthenumberoadolescentgirlswhosigned

uporsavingsaccountsandtheirproductuseHowever,itsoonrecognizedthatlow-income

adolescentgirlshaveveryewnancialresourcesandlittlemoneytoputasideorsavings

Asaresult,Xacbankchangeditsdenitionosuccesstowhethertheadolescentgirls

participatinginitsnancialeducationprogrammeincreasedtheirknowledgeand

understandingonancialissues

TargetAudience

Mongoliahasoneothehighestliteracyratesintheworldat9%,andaccesstoschoolingisnearlyuniversalSecondaryschoolattendanceisactuallyhigherorgirlsthan

orboys(9%and%,respectively) ThemedianageinMongoliaisyears, 9and%

oMongoliansliveinpoverty0XacBanksawnancialeducationasatoolthatcouldhelp

theircustomersbuildtheskillsneededtomoreeectivelymanagetheirlimitednancial

resourcesandimprovetheirnancialwell-beingXacBankbecameparticularlyinterestedin

targetingyounggirlsbecauseitviewsthemasuturehouseholdnancialmanagers,capable

oinfuencingboththeiramiliesandtheircommunitiesMarketresearchconductedby

XacBank,MicronanceOpportunities(MFO),andWomensWorldBanking(WWB)revealed

thatgirlsdidnothavesavingshabits,muchlesstheknowledge,tools,encouragement,andopportunitiestobuildsavingsAsaresult,XacBankdecidedtotargetgirlsyearsold

withnancialeducation

16XAC[Goldenundordevelopment]LLCandGoviinEkhlel[Gobiinitiative]LLC17CIAWorldFactBook(2010)MongoliaRetrievedJune2011romwwwciagov/library/publications/theworldact

book/geos/mghtml18UNICEFwebsite(2010)AtaGlanceMongoliastatisticsRetrievedJune2011ro

Documents

Taking Stock Financial