The Role of Financial Institutions in Financial Education Shariq Mukhtar Citi Country Officer, Indonesia OECD-Bank Indonesia International Conference on Financial Education October 21, 2008 Bali, Indonesia
Financial Literacy in Indonesia Indonesia s Fin-Q score: 52.2 (out of 100) If they lost their jobs tomorrow, most respondents said their savings would last them less than 11 weeks 6 out of 10 Indonesians do not plan for their retirement Less than 25% have a formal retirement plan 39% believe that they will rely on their children as they get old 58% admitted an average understanding of personal financial management Source: Citibank Indonesia Fin-Q (Financial Quotient) Survey - 2007 2
Our Rationale 1 2 3 Leverages our financial expertise Leverages our knowledge of consumer needs Develops more informed and responsible consumers 3
A Financially Literate Customer Is more confident Saves for their retirement Develops financial goals Balances their checkbook Is concerned about their credit rating Lives within their means Follows a budget Is a home owner Establishes good relationships with financial institutions Loyalty factor 4
Citi s Parallel Approach Use Credit Wisely Educational websites Credit tools & advice Media outreach Save & Invest Wisely Publications & seminars Industry investment fairs Financial literacy surveys Community Country/regional programs for youth and adults Capacity building of the financial education community Responsible advice to customers and other consumers BUSINESS RESPONSIBILITY Support for: Low-income/disadvantaged Advocates/practitioners COMMUNITY RESPONSIBILITY 5
Use Credit Wisely Educational Websites www.usecreditwisely.com Australia, India, Indonesia, Korea, Malaysia, Philippines, Singapore, Taiwan, Thailand Citibank Indonesia s website available in Bahasa 6 Citibank India s website
Use Credit Wisely Localized Credit Tools & Advice 10.000 booklets produced and distributed 7
Use Credit Wisely Media Outreach Journalist classes including financial education Involving various media in major cities of Indonesia Participation and support of regulators and partners 8
Additional Media Outreach Consumer Protection 9
Save & Invest Wisely Publications & Seminars Alliance of Experts series Hong Kong, Korea, Singapore, Taiwan, India, Indonesia and Philippines 10 Regular publication to inform customers on the latest trends, financial tips, banking products and services
Save & Invest Wisely Industry Investment Fairs Outreach to investors in collaboration with major industry players 11
Fin-Q Surveys Regional Financial Quotient survey to analyze financial literacy, and consumer behaviour in savings, investing, insurance and retirement 6 out of 10 Indonesians do not save for their retirement 12
Community Agent Penny in Primary Schools 13 Primary school children comic, drama, teacher s kit, website Implemented in China, Hong Kong, Indonesia, Malaysia, Singapore, Taiwan
Community Financial TV Show for General Public TV Program with weekly financial tips Topics: credit cards, investing, consumer finance, insurance, etc. Audience can ask questions online according to financial needs 14
Community Financial Education for The Poor Launched in 2007, aimed at helping microentrepreneurs expand their businesses US$131,000 Citi Foundation grant for Indonesia to reach 150 microfinance providers in Bandung, Jogjakarta, Surabaya, Denpasar, Makasar and Balikpapan 15
Community Developing Finance Sector Talent Citi University Banking Course has become part of the university curriculum Similar banking courses are running across the region 16 University of Indonesia Lectures by Citi Indonesia management
Community Financial Education Partnerships 17 Partnership with Bank Indonesia to support 2008 Financial Education Year Educating the general public by disseminating information and using AYO ke BANK mobile units
Community Financial Education Capacity-building Citi-FT Financial Education Summit - New Delhi, December 2007 18
Citi s Long-term Commitment to Financial Education Knowledge is Your Greatest Asset Creation of the Citi Office of Financial Education in 2004 10-year global US$200 million commitment to financial education programs (funded by the Citi Foundation and Citi businesses) US$121 million spent to date US$36 million spent in 2007 in 65 countries over 9 million lives touched in 2007 19