Insight and Blight – Initiatives on Enhancing Financial Literacy in Hungary

Abstract

The standard of financial literacy affects the effective management of economic and income shocks both on the individual and national levels. Earlier surveys implied the ineffectiveness of financial literacy enhancing training programmes in Hungary. We surveyed the training organisations by using questionnaires and examined the characteristics of financial literacy courses along with the possible reasons for their ineffectiveness. The survey data were analysed by descriptive statistics and hypothesis tests. We found that four big organizations trained more than 90 per cent of the total 500 thousand people who attended such courses in recent years in Hungary. Students from elementary and secondary schools are heavily overrepresented in these courses. The courses are predominantly short; however, they cover multiple topics. Although some two fifths of the training programmes rely on public funds, only one third of them publish the syllabuses and training materials. We also found that the educational needs of the target groups are usually assessed; however, the effectiveness of the training programmes is usually not measured. We concluded that enhancing financial literacy in vulnerable social groups would require a more targeted support from the government. Additionally, in order to encourage the responsible and reasonable use of public funds, publicly funded financial literacy enhancing programmes should disclose reports on their effectiveness, they should publish course syllabuses and materials and apply quality control. Furthermore, it is crucial to revamp the practice of enhancing financial literacy in Hungary; the assessment and development of financial literacy should be realised with targeted funding in an organised, transparent and quality-controlled way.