nep-fle New Economics Papers
on Financial Literacy and Education
Issue of 2024‒07‒08
four papers chosen by
  1. Financial literacy in credit institutions By Sara Boukaidi Laghzaoui; Youssra Dkier
  2. Cameroon’s Tax on Mobile Money: Implications for Agents' Performance and Revenue Sustainability By Noah, Alphonse; Tacneng, Ruth
  3. How Will Central Bank Digital Currencies (CBDCs) Influence Tax Administration in Developing Countries? By Arewa, Moyo
  4. Peer Effects in Financial Decisions: Evidence from Dutch Administrative Data By Katja M. Kaufmann; Yasemin Özdemir; Michaela Paffenholz
  1. By: Sara Boukaidi Laghzaoui (USMBA - Université Sidi Mohamed Ben Abdellah); Youssra Dkier (USMBA - Université Sidi Mohamed Ben Abdellah)
    Abstract: The global financial crisis of 2007, triggered by the failure of risky mortgage loans, drew governments' attention to the need for improving their citizens' financial literacy. This growing concern stems from increased individual responsibility, driven by factors such as longer life expectancy, rising education costs, and reductions in social benefits. Additionally, there has been a significant expansion in the supply and demand of financial products and services. Financial literacy, especially among bank customers, plays a pivotal role in shaping the behavior of bank directors. It influences the mechanisms for provisioning loan losses and opportunistic actions. Clients with strong financial literacy represents more stable sources of funding and contribute to more predictable loan loss provisions, thus fostering more consistent bank revenues. Furthermore, financial literacy enhances clients' ability to monitor banking performance and assess risk-taking, reducing the opportunities for opportunistic profit manipulation by bank directors. This article serves as a theoretical synthesis aiming to provide a comprehensive perspective on key concepts while shedding new light on the understanding of financial literacy among clients of the Banque Populaire and the financial support extended to small and medium-sized enterprises. In addition to offering financial advice, banks should actively engage in community initiatives aimed at bolstering the financial literacy of their clients. This commitment significantly impacts the enhancement of citizens' financial skills, leading to a better understanding of financial issues and an accumulated stability in the banking sector. Ultimately, the financial literacy of client's benefits society as a whole.
    Abstract: La crise financière mondiale de 2007, déclenchée par l'échec des prêts hypothécaires à risque, a attiré l'attention des gouvernements quant à l'amélioration de la littératie financière de leurs citoyens. Cette préoccupation s'accumule découle de la responsabilité individuelle grandissante, motivée par une espérance de vie prolongée, des coûts d'éducation en augmentation et des réductions des prestations sociales. De plus, l'offre et la demande de produits et services financiers ont connu une expansion significative. La littératie financière, notamment chez les clients des banques, joue un rôle déterminant dans les comportements des directeurs de banque. Elle influence les mécanismes de provisionnement des pertes sur prêts ainsi que les actions opportunistes. Les clients dotés d'une littératie financière solide représentent des sources de financement plus stables et contribuent à des provisions de pertes sur prêts plus prévisibles, favorisant des revenus bancaires plus constants. De plus, la littératie financière renforce la capacité des clients à surveiller les performances bancaires et à évaluer les prises de risque, notamment les possibilités de manipulations opportunistes des bénéfices par les directeurs de banque. Cet article constitue une synthèse théorique visant à offrir une perspective globale sur les principaux concepts, tout en apportant un nouvel éclairage sur la compréhension de la littératie financière chez les clients de la Banque populaire, ainsi que sur le soutien financier accordé aux petites et moyennes entreprises. Les banques, en plus de fournir des conseils financiers, devraient s'engager activement dans des initiatives communautaires visant à renforcer la littératie financière de leurs clients. Cet engagement a un impact significatif sur l'amélioration des compétences financières des citoyens, ce qui contribue à une meilleure compréhension des enjeux financiers et à une stabilité accumulée dans le secteur bancaire. En fin de compte, la littératie financière des clients profite à l'ensemble de la société.
    Keywords: Littératie financière Performance Secteur Financier Gestion de la Dette Investissement. JEL Classification : G53 Type du papier : Recherche Théorique Financial Literacy Performance Financial Sector Debt Management Investment. Classification JEL: G53 Paper type: Theoretical Research, Littératie financière, Performance, Secteur Financier, Gestion de la Dette, Investissement. JEL Classification : G53 Type du papier : Recherche Théorique Financial Literacy, Financial Sector, Debt Management, Investment. Classification JEL: G53 Paper type: Theoretical Research
    Date: 2023–12–23
    URL: http://d.repec.org/n?u=RePEc:hal:journl:hal-04563461&r=
  2. By: Noah, Alphonse; Tacneng, Ruth
    Abstract: Mobile money taxation gives African governments an opportunity to broaden their fiscal base and explore new revenue-generating possibilities. Cameroon introduced a 0.2 per cent tax on mobile money transfers and withdrawals from 1 January 2022. Our research analyses the behaviour of agents, who act as intermediaries between mobile money account holders and mobile money service providers, before and after the tax on mobile money (MM tax). Agents play a key role in the distribution of mobile money services. Their presence is vital for achieving financial inclusion, especially in areas less served by banks and other traditional financial service providers. An agent’s revenue is mainly derived from commission earned on each transaction – they receive an average of 40–45 per cent of the commission, and the remaining 55–60 per cent is shared between the mobile network operator, partner banks, and agent’s manager (superagent). Given their importance in the mobile money ecosystem, factors that negatively affect the attractiveness of the business for agents could have policy implications on financial inclusion. Summary of ICTD Working Paper 192.
    Date: 2024
    URL: https://d.repec.org/n?u=RePEc:idq:ictduk:18367&r=
  3. By: Arewa, Moyo
    Abstract: This paper explores the potential benefits and risks to tax administrations of implementing central bank digital currencies (CBDCs), a digital version of national currencies that is gaining momentum worldwide. It outlines some of the key features of CBDCs and then considers their implications for tax administration in low- and middle-income countries (LMICs) generally. The emergence of CBDCs provides LMICs with a significant opportunity to improve financial inclusion, improve payment systems and increase tax collection. CBDCs provide greater transparency, security and traceability, which could help tax authorities track income and net worth, detect tax evasion and increase tax revenue. However, there are also complex combinations of risks associated with deploying CBDCs. The revenue authorities need to thoroughly assess how they should adapt to these challenges. Governments must also ensure that CBDCs are developed and implemented transparently, fairly and consistently with broader public policy goals. This will help maximise the potential benefits of CBDC adoption while mitigating the risks – which may be particularly significant in LMICs.
    Date: 2024
    URL: https://d.repec.org/n?u=RePEc:idq:ictduk:18361&r=
  4. By: Katja M. Kaufmann; Yasemin Özdemir; Michaela Paffenholz
    Abstract: We study whether, to what extent, and how a couple’s decision to invest into risky assets the first time is affected by their social environment, in particular by their (adult) siblings and their coworkers. We provide causal evidence of peer effects in financial decisions, making use of Dutch administrative data and an IV strategy with partially overlapping peer groups. We find that positive asset market experiences of siblings, as well as of coworkers, generate positive spillover effects in terms of first-time investments in risky assets. These effects are primarily driven by the siblings and coworkers of the male partner in the couple ("receiver" of the signal). However, coworker spillovers are also relevant for full-time employed women. In terms of "sender" of the signal, only male coworkers lead to spillovers, for the couple overall and for female and male partner separately, consistent with men being more likely to talk about their financial successes. Heterogeneity analyses show that peer spillovers are particularly important for highly (financially) educated and more privileged couples, consistent with them having the financial means as well as the (financial) knowledge to be able to evaluate and respond to the signal of positive asset market experiences of peers.
    Keywords: spillovers, peer effects, financial decisions, stock market participation
    JEL: G11 G53 G51 Z13
    Date: 2024–05
    URL: http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2024_553&r=
General information on the NEP project can be found at https://nep.repec.org. For comments please write to the director of NEP, Marco Novarese at <director@nep.repec.org>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.
This page is being maintained by Thomas Krichel. It was last updated on 2024‒07‒28 at 8:07.