Strategic national financial education – world experience and contact Vietnam

Financial education is not a new problem in the world, it has attracted the attention of governments and the involvement of international organizations such as the OECD and the World Bank. Especially, since the US financial crisis in 2008 stems from insufficient awareness about the risks of subprime mortgages and the securities are guaranteed by these loans, problem understanding financial community become increasingly important and many countries have put financial education on a national strategy.
According to OECD / INEF (2012), a strategic national financial education is defined as “a tendency to that country’s access to financial education in which a structure and programs were / are or will be implementation include: (i) The realization of the importance of financial education, offering defined as influential at the national level based on the needs and shortcomings of the host country; (Ii) with the participation of the agencies concerned under the direction and supervision of a lead agency; (Iii) Develop a schedule to achieve the specific goals outlined in a certain time period; (Iv) Provide documentation to strategies that can be applied in the specific program and contribute to a complete detail a national strategy. The national strategy on financial education can launch from many different situations, such as from the increased awareness of the importance of financial knowledge or from efforts to create greater consensus during deployment. The work program of the government will play a decisive role for the political support for a national strategy on financial education have important implications not only for ensuring the implementation, but also for the maintain this strategy.
Factors that countries deployed strategic national financial education
The national strategy on financial education have the opportunity to thrive after the world financial crisis as the financial literacy problem given strong in many countries. In some countries, strategic national financial education is built on the basis of links or as part of a reform agenda or national policy priorities larger, especially the reforms or offers policy priority in the financial sector or the structure of financial supervision. This is the case in South Africa, where institutional changes have led to the creation of new regulatory agencies, and in Malaysia, where the reforms in the financial sector has led to the improvement of protection of financial consumers, including financial education is considered to be a key component.
In some other countries, the evidence on the state of financial literacy in the population low and its detrimental effects has led to the introduction of the national strategies for financial education.
Also, in countries where some financial education programs have been implemented, these countries find the lack of coordination among the participating organizations to educate the users of financial services. The organizations operate independently but can not thoroughly solve the gap in financial knowledge that exist in the country. Therefore, the authority of the national government decided to intervene to coordinate the organization has been involved in financial education activities in order to improve their operational efficiency, as in Estonia, Ireland, Poland, South Africa, Canada [1].
The scope and objectives of the strategic national financial education in the country
Each country will have different approaches towards the construction of a national strategy for financial education. The national strategy is usually formed in two ways / forms, however, these two forms of interaction with each other. The first way is also the most common way, the national strategy is in part or as a complement to an overall national program to increase power for financial consumers (often including protect financial consumers and the solutions to improve access to finance). According to the latter, the national strategy is developed independently and to address certain challenges of financial understanding.
In many countries, national strategies on financial education as part of a larger overall program (18 countries in the OECD sample INFE). In most countries, national strategies closely associated from the beginning with the strategy to protect financial consumers and is considered as a supplement to regulate activities in the financial sector. In addition, the introduction of strategic national financial education also stems from the changes in the structure of financial markets or changes in the economic, social and demographic.
In emerging countries, the development of strategic national financial education often stem from Ancillary universal financial solutions to raise the proportion of people have access to financial services. This is the case took place in India and Indonesia (and also in Mexico). In these countries, the strategic national financial education is considered to be a pillar of the process of improving access to financial services.
Contacts practices in Vietnam and recommendations
Since Vietnam officially joined the World Trade Organization (WTO) to date, the financial system and particularly the banking system in Vietnam has experienced strong growth. As of quarter II / 2013, the system has three banks State commercial banks, 36 joint stock commercial banks, four joint-venture banks, 47 foreign bank branches. The bank system has a network covering the whole of the provinces and cities across the country. Some branches of the bank was present to take the district or even the commune, which, increasingly meets the demand for banking products and services by organizations and individuals at home and abroad.
Along with the increase in the number of networks, branch, product and service quality of the banking sector is also increasingly diversified to meet the needs of consumers. In addition to the traditional products and services have appeared many new services requires a knowledge of finance as well as certain understanding. Therefore, a program of financial education is essential and contribute to improving the quality of human resources of the banks, both equipped with / provide basic financial knowledge to residents and organizations , serving for the support improved access to services.
Some specific recommendations are given as follows:
– Bringing financial education to become a national strategy with two main objectives: (i) Protection of financial consumers, and (ii) Improving the understanding of the people for financial products. Specific:
+ Develop policies and regulations in the official legal documents on financial knowledge dissemination, thereby shaping and developing the action plan, the campaign to raise financial literacy for all People;
+ Develop a mechanism to monitor and coordinate the implementation of financial education programs between the relevant authorities; which emphasizes the role of the central bank, the Ministry of Finance and the Ministry of Education and Training;
+ Determine the subject of financial education programs must be expanded, targeting the rural population, in remote areas, the working poor; Integrating the most popular programs of financial knowledge with the social welfare program.
– Develop financial education programs to support effective and immediate implementation of the scheme for improving access to banking services in the economy, in particular:
+ Mounting financial education with the development, promotion and practical use of one or more products, specialized services consistent with the needs of each target group, especially residents of rural, remote areas direct remote areas to boost confidence and impact change usage habits financial products of the people.
+ Select modes of communication and promotion of financial knowledge and financial products and services suited to the characteristics of each target group. For people in remote areas, educational level is limited, upholding the power of media images, sound directly through banners and radio system with a brief message, understandably go together with the benefits of participating in the program to encourage the participation of local people;
+ Deployment of financial education from many sides: from community programs to the participation of the private sector and the support of foreign organizations.

References:
1 – OECD (2005b), Improving Financial Literacy: Analysis of Issues and Policies
2 – Grifoni, A. and F. Messy (2012), “Current Status of National Strategies for Financial Education: A Comparative Analysis and Relevant Practices”, OECD Working Papers on Finance, Insurance and Private Pensions, No. 16, OECD Publishing.
3 – Strategic Institute – SB (2014), Proposed Enhanced Accessibility Services Annex.

MSc. Nguyen Thi Hien, MA. Pham Xuan Lam (Banking Strategy Institute)