A change in behaviour. Innovations in financial capability

Center for Financial Inclusion. Action

This document, prepared by the Center for Financial Inclusion, is part of the recent theories about the importance of “financial behaviours” for financial inclusion. It highlights the benefits of financial inclusion projects that focus on building financial capability, which is understood to be the combination of know-how, skills, attitude and behaviours that a person needs to make for the right financial decisions to improve his or her living standards. The concept goes beyond financial education as it involves people’s attitudes and behaviours.

Financial capability projects from all over the world have been analysed to prepare the report, especially from Mexico and India.

Projects of this kind are of interest basically for three groups of people:

  • Providers of financial services, because a financially capable clientele enhances the prospects of growth, reduces risk and improves the use of products;
  • Governments, because it promotes a stable, secure financial system;
  • Financial consumers, because know-how generates confidence and security and stimulates the use of financial products.

The document recommends 6 favourable practises for building financial capability:

  1. Involving all kinds of financial services suppliers,  not just banks;
  2. Reinforcing government support for consumers, service providers and other stakeholders to build financial capability;
  3. Attracting tertiary-sector agencies that work with the base of the pyramid;
  4. Incorporating practises that promote changes in financial behaviour in financial education programmes;
  5. Stringently measuring results and impact;
  6. Promoting customer oriented financial capability strategies.