Public Disclosure Authorized EUROPE AND CENTRAL ASIA Russian Federation Finance, Competitiveness and Innovation Global Practice IBRD/IDA Investment Project Financing FY 2011 Seq : 16 ARCHIVED on 27-v-2018 ISR34515 Implementing Agencies: Ministry of Finance, ncommercial Foundation for Enterprise Restructuring and Financial Institutions Development (FER), Russian Federation Public Disclosure Authorized Key Dates Key Project Dates Bank Approval Date: 07-Dec-2010 Planned Mid Term Review Date: 23-v-2014 Original Closing Date: 30-Jun-2016 pdotable Project Development Objectives Effectiveness Date: 29-Jul-2011 Actual Mid-Term Review Date: 23-v-2014 Revised Closing Date: 31-Dec-2020 Public Disclosure Authorized Public Disclosure Authorized Project Development Objective (from Project Appraisal Document) Project development objectives are to: (i) improve the financial literacy of Russian citizens (especially, among the school-age and college students, and active and potential low- and middle-income users of financial services); and (ii) strengthen the foundations for improving consumer protection in financial services. Has the Project Development Objective been changed since Board Approval of the Project Objective? Components Table Name Development of financial literacy strategy and financial literacy and consumer protection monitoring and evaluation:(cost $22.26 M) Financial Literacy Capacity Building:(Cost $66.10 M) Development and implementation of education programs and information campaign for improving financial literacy, incl $14 million in sub-projects:(cost $53.65 M) Strengthening of consumer protection in financial services:(cost $59.70 M) Project Management:(Cost $6.94 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO Satisfactory Satisfactory Overall Implementation Progress (IP) Satisfactory Satisfactory Overall Risk Rating Moderate Moderate Implementation Status and Key Decisions This is an interim update before next supervision mission planned for December 2018 which will provide a full update. The project has achieved much during the 7.5 years of implementation: 11/27/2018 Page 1 of 10
On September 29, 2017, the Ministry of Finance and the Central Bank approved the National Strategy for Financial Literacy for the Russian Federation 2017-2023 and its implementation roadmap. (The Financial Education and Literacy Expert Council chaired by Mr. Alexey Kudrin approved the strategy on December 14, 2015. The Central Bank and the Ministry of Finance then jointly finalized it for presentation to the government.) Russia placed 4th in the world in the recent 2015 PISA survey on financial literacy, moving up from 10th place in the 2012 PISA and pushing Russia above the OECD average. Russia s gain was the largest by any country. It is highly plausible that the project s contribution to this outcome was strong if not decisive. The PISA Financial Literacy Assessment uses random selection and results in absolute rankings. The OECD s cross-country analysis of results from the PISA Financial Literacy Assessment shows that about 38 percent of outcomes of improvements in financial literacy rates are due to specific financial education and financial literacy interventions (other than general numeracy and literacy skills). While Russia has improved marginally on numeracy and literacy (Russia is just below the OECD avearge in math and slightly above the OECD average in reading and science) outside of this project, there have been no other countrywide interventions contributing to the same purpose. Therefore, Russia s improvement on the PISA Financial Literacy Assessment between 2012 and 2015 should in large part be attributed to the project interventions. The WB team shared international best practices on regulatory frameworks regarding financial providers disclosure of financial information to consumers. The project helped establish three federal methodological centres of financial literacy and a network of methodological centres in 13 regions to train tutors. The project helped establish a user-friendly financial literacy and consumer protection informational and educational portal http://вашифинансы.рф/en/about/ ; The project supported the implementation of regional financial literacy development programs in the 9 pilot regions. These development programs helped establish regional financial literacy centres and develop and test financial literacy education curricula, textbooks, and other materials. The project supported completion of five reports on the status of financial consumer protection. The project helped develop 16 consumer counselling standards, which were tested and introduced in Rospotrebnadzor (the Agency for Protection of Consumer Rights and Human Welfare). The project supported the launch of the consumer protection agency on-line kiosk and 24/7 hotline service for consumer protection guidance The project supported the development of annual public information campaigns using social media and organised events like All Russia Financial Literacy Week for children and young people, National Savings Week, and information materials like the I want, I can, I know series illustrating consumer rights for key financial services. These events and materials reach millions of people every year. The project supported the 2017 launch of the TV series (soap-opera) Happiness Money Can t Buy with an audience of more than 1 million people. The project contributed to the October 26, 2012 approval of the law on personal insolvency/bankruptcy (para 1.1 restructuring citizen s debt and sale of citizens property), which entered into force on October 1, 2015. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance -- Substantial Substantial Macroeconomic -- Substantial Substantial Sector Strategies and Policies -- Low Low Technical Design of Project or Program -- Low Low Institutional Capacity for Implementation and Sustainability -- Low Low Fiduciary -- Low Low Environment and Social -- Low Low Stakeholders -- Low Low Other -- Low Low 11/27/2018 Page 2 of 10
IN00583085 IN00583089 IN00583099 IN00583090 Overall -- Moderate Moderate Results PDO Indicators by Objectives / Outcomes PDO Indicators on Financial Education and Literacy IN00583054 1.1 (1.1.1) % of active and potential low- and middle-income users of financial services understanding the trade-off between risk and rewards in choosing financial products in Kaliningrad & Volgograd (Percentage, Custom) 63.90 66.70 66.70 68.00 1.1 (1.1.2) % of active and potential low- and middle-income users of financial services understanding the trade-off between risk and rewards in choosing financial products in 7 other regions (Percentage, Custom Supplement) 66.30 66.30 66.30 68.00 IN00583084 1.2 (1.2.1) % of school-aged and college students understanding risk-reward trade-off and rewards in choosing financial products in Kaliningrad and Volgograd pilot regions (Percentage, Custom) 53.00 53.00 53.00 55.00 1.2 (1.2.2) % of school-aged and college students understanding risk-reward trade-off and rewards in choosing financial products in 7 other regions (Percentage, Custom Supplement) 51.90 51.90 51.90 54.00 IN00583055 2.1 (2.1.1) % of active and potential low- and middle-income users of financial services understanding the importance of financial cushion in Kaliningrad and Volgograd pilot regions (Percentage, Custom) 30.50 35.70 35.70 37.00 2.1 (2.1.2) % of active and potential low- and middle-income users of financial services understanding the importance of financial cushion in 7 other regions (Percentage, Custom Supplement) 31.70 31.70 31.70 33.00 11/27/2018 Page 3 of 10
IN00583100 IN00583091 IN00583101 2.2 (2.2.1) % of school-aged and college students understanding importance of financial cushion in Kaliningrad and Volgograd pilot regions (Percentage, Custom) 75.50 75.50 75.50 77.00 Date 29-May-2015 15-Apr-2018 22-Oct-2018 31-Dec-2020 2.2 (2.2.2) % of school-aged and college students understanding importance of financial cushion in 7 other regions (Percentage, Custom Supplement) 74.50 74.50 74.50 76.00 IN00583066 3. (3.1) % of active and potential low- and middle-income users of financial services who compare alternatives before obtaining a credit in Kaliningrad and Volgograd pilot regions (Percentage, Custom) 69.20 70.30 70.30 72.00 3. (3.2) % of active and potential low- and middle-income users of financial services who compare alternatives before obtaining a credit in 7 other regions (Percentage, Custom Supplement) 60.20 60.20 60.20 63.00 IN00583086 4. (4.1) % of active and potential low- and middle-income users of financial services who know what aministrative/legal action to be taken having discovered a deceit by provider of a financial service (Percentage, Custom) 32.20 39.80 39.80 42.00 4. (4.2) % of active and potential low- and middle-income users of financial services who know what aministrative/legal action to be taken having discovered a deceit by provider of a financial service (Percentage, Custom Supplement) 39.60 39.60 39.60 42.00 Overall Comments PDO This is an interim update - no new updates on indicators until next supervision mission and surveys (to be completed end December 2018). Intermediate Results Indicators by Components 11/27/2018 Page 4 of 10
IN00583067 IN00583068 IN00583069 IN00583070 IN00583071 IN00583072 Development of financial literacy strategy and financial literacy and consumer protection monitoring and evaluation 1.1 Financial literacy strategy is developed and agreed between key stakeholders (Text, Custom) Yes. After extensive Yes. After extensive internal and external internal and external consultations the consultations the National Strategy has National Strategy has now been approved by now been approved by the Central Bank and the Central Bank and Ministry of Finance. Yes Ministry of Finance. On On September 29, September 29, 2017, the 2017, the strategy was strategy was approved approved by by government - a key government - a key achievement and achievement and milestone. milestone. 1.2 Requirements to education programs are approved by the Expert Board (Text, Custom) Yes Yes Yes Date 28-Dec-2010 08-Jun-2015 08-Jun-2015 31-Dec-2020 1.3 Four rounds of the FL assessment are conducted in YR 2,5,8,10 (Text, Custom), survey to be conducted in year 8 (2018) and 2020, survey to be conducted in year 8 (2018) and 2020 Yes, with extension survey shifted from Y7 to Y8 and now also year 10 1.4 Four rounds of the Consumer Finance Survey are conducted in YR 2,5,8, 10 (Text, Custom), survey to be conducted in year 8 (2018) and 2020, survey to be conducted in year 8 (2018) and 2020 Yes, with extension survey moved from Y7 to Y8 and now also year 10 1.5 Ministry of Finance establishes dedicated working group on financial literacy and consumer protection (Text, Custom) Yes Yes Yes Date 01-Sep-2010 30-v-2015 30-v-2015 31-Dec-2020 11/27/2018 Page 5 of 10
IN00583073 IN00583076 IN00583092 IN00583093 IN00583094 1.6 Amendments to the federal legislation to provide for effective consumer protection in financial markets and financial literacy are prepared (Text, Custom) Yes Yes Yes Date 28-Dec-2010 15-Apr-2018 22-Oct-2018 30-Apr-2019 Financial Literacy Capacity Building 2.1 # of regional FL development programs being implemented with the Project support (Number, Custom) 0.00 9.00 9.00 9.00 IN00583074 2.2 (2.2.1) # of teachers of the relevant subjects trained by the Project in regions (two pilot and new participating regions) (Number, Custom) 0.00 7,500.00 7,500.00 38,000.00 IN00583075 2.3 (2.2.2 (methodists) and 2.4 (consultants) # of financial literacy specialists (consultants) and methodists trained for general education and vocational schools by the Project regions (two pilot an (Number, Custom) 0.00 2,500.00 2,500.00 6,800.00 Date 28-Dec-2010 15-Apr-2018 22-Oct-2018 30-Apr-2019 (2.7) Number of financial literacy textbooks published and distributed in regions (up to < 6,000,000) (Number, Custom Supplement) 0.00 0.00 0.00 8,000,000.00 # methodists for general education and vocational schools, prepared by the Project (Number, Custom Supplement) 0.00 -- 0.00 1,500.00 2.3 (2.3: # students - future teachers trained under the Project in financial literacy) (Number, Custom Supplement) 0.00 0.00 0.00 12,000.00 2.6 FL information and educational portal established and fully operational (Text, Custom) 11/27/2018 Page 6 of 10
IN00583081 IN00583082 IN00583083 IN00583095 IN00583098 IN00583097 Yes, and about 75000 visitors to site Yes, and about 75000 visitors to site Yes 2.5. #education events carried out by financial consultants (Number, Custom Supplement) 0.00 4,050.00 4,050.00 15,000.00 Strengthening of consumer protection in financial services IN00583080 4.1 A system of hotline call centers to advise consumers on financial issues is established and operational (Yes or ) (Number, Custom) 0.00 -- 0.00 0.00 Date 28-Dec-2010 30-Jun-2016 30-Jun-2016 31-Dec-2020 4.1.1 Total number of complaints consultations on financial consumer rights issues provided by Rospotrebnadzor specialists (target value - 10 000 annualy) (Number, Custom Breakdown) 17,175.00 117,547.00 117,547.00 150,000.00 4.1.2 Number of financial consumer complaints examined through Rospotrebnadzor "hotlines" and public officers (target value - 5000 complaints annualy) (Number, Custom Breakdown) 7,801.00 68,377.00 68,377.00 80,000.00 4.2 Special system for submitting and handling financial consumer complaints in e-format is developed (Text, Custom) Yes, the system is now established. Yes, the system is now established. Yes 4.3 An e-library (infotheque) on topical CP issues is established and operational (Text, Custom) Yes, it is now Yes, it is now established established and Yes and functioning. functioning. Date 28-Dec-2010 15-Apr-2018 22-Oct-2018 30-Apr-2018 11/27/2018 Page 7 of 10
IN00583077 IN00583078 IN00583102 IN00583096 IN00583103 4.4 Number of Rospotrebnadzor consulting centres for consumers in Russian Federation (Number, Custom) 0.00 580.00 580.00 500.00 Date 28-Dec-2010 15-Apr-2018 22-Oct-2018 31-Dec-2015 IN00583087 4.5 # of Rospotrebnadzor specialists trained during the Project on financial consumer protection and financial literacy (Number, Custom) 0.00 608.00 608.00 1,000.00 IN00583088 4.6 # of the reports dedicated to the financial consumer protection, containing independent monitoring results and recommndations (Amount(USD), Custom) 0.00 5.00 5.00 9.00 (4.8) # of information materials (booklets/leaflets) on financial consumer protection distributed to consumers by Rospotrebnadzor staff (Amount(USD), Custom Supplement) 0.00 7,650,000.00 7,650,000.00 9,100,000.00 Development and implementation of education programs and information campaign for improving financial literacy, incl $14 million in sub-projects 3.1 (3.1.2) # of educational modules and learning materials developed nationally at federal level (Number, Custom) 0.00 107.00 107.00 120.00 3.1 (3.1.1) # educational programs created at Federal level (Number, Custom Supplement) 0.00 27.00 27.00 30.00 (3.9) Number of digital products (information, edutainment and social ad videos, games, webpages) created under Funds of Good Ideas (Number, Custom Supplement) 0.00 109.00 109.00 140.00 3.2 National information campaign designed and launched (Text, Custom) 11/27/2018 Page 8 of 10
Yes Yes Yes IN00583079 3.3 (3.6) # of financial literacy and consumer protection improvement initiatives supported through the Fund of Good Ideas (Number, Custom) 0.00 65.00 65.00 124.00 Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed % Disbursed P120338 IBRD-79830 Effective USD 25.00 25.00 0.00 19.11 5.89 76% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P120338 IBRD-79830 Effective 07-Dec-2010 14-Mar-2011 29-Jul-2011 30-Jun-2016 31-Dec-2020 Cumulative Disbursements 11/27/2018 Page 9 of 10
Restructuring History Level 2 Approved on 11-Jun-2015,Level 2 Approved on 06-Jan-2017,Level 2 Approved on 12-May-2017,Level 2 Approved on 09-Mar-2018 Related Project(s) There are no related projects. 11/27/2018 Page 10 of 10