An Assessment Tool to Identify the Financial Literacy Level of Financial Education Programs Participants’ Executed by Ecuadorian Financial Institutions
Abstract
:1. Introduction
2. FL Conceptual Basis
2.1. FL and Its Dimensions
2.2. Scales for Measuring FL
2.3. FEP in Ecuador
2.4. Sociodemographic Factors in FL
3. Research Design
3.1. Sample
3.2. Data Collection
3.3. Informed Consent
3.4. Scale Design
- Structure, concepts, actors, and operation of controlled systems;
- Financial planning, saving, and preparation of a family budget;
- Rights and obligations contained in the “Code of Rights of the User of the Financial System”;
- Role of the Superintendency of Banks;
- Administration, associated risks, rights, and obligations of credit operations;
- Forms and legal figures established to exercise their rights and claims both within the controlled entity and in public bodies.
- Administration, handling, use, rights and obligations, and associated risks of the products offered by the controlled system, such as savings books, current accounts, and use of checks, term deposits, credits, and credit cards, among others;
- Administration, management, use, rights and obligations; and risks associated with the financial services offered, such as debit cards, ATMs, electronic banking, drafts and transfers, and remittances, among others;
- Insurance related to the products offered by the controlled entities, especially about general information on insurance, the rights and obligations of the insured, the risks covered and insurance exclusions, the insured amounts, and the process, requirements, and deadlines to make claims in the event of the loss, among others;
- Use of transactional channels.
3.5. Analysis Procedure
4. Results
4.1. EFA
4.2. CFA
4.2.1. Correlation Matrix Analysis
4.2.2. Fit Measures
4.2.3. Measure of Reliability and Validity of Convergence (Convergent Validity)
4.2.4. Structural Relationships and Hypothesis Testing
4.3. Descriptive Analysis and Correlation Analysis
4.4. Hypotheses
4.5. The Bank’s Customer Preferences
5. Discussion
6. Conclusions
Supplementary Materials
Author Contributions
Funding
Institutional Review Board Statement
Informed Consent Statement
Data Availability Statement
Acknowledgments
Conflicts of Interest
Appendix A
Code | Items | Factor Loading | Item Source | |
---|---|---|---|---|
Author | Action | |||
FK (correct answer). α 0.794 | ||||
FK-1 | What type of income do you think should be used for budgeting? [Money owed to us by other people]; [Inheritance to receive in the future]; [Fixed income]; [Variable income]; [None of the above]; [I don’t know] | X | 2 | A |
FK-2 | What is the regulation in charge of protecting the rights of the Financial User? [Comprehensive Organic Criminal Code]; [Internal Tax Regime Law]; [Companies Law]; [User Rights Code]; [None of the above]; [I don’t know] | 0.83 | 1 | N |
FK-3 | Regulatory entity of the State that is in charge of regulating and controlling the financial activity of cooperatives at the national level. [Superintendency of Banks of Ecuador]; [Superintendence of Popular and Solidarity Economy]; [Superintendency of Companies]; [Superintendency of market power control]; [None of the above]; [I don´t know] | 0.85 | 1 | N |
FK-4 | Is the Pledge Credit a…? [Education Credit]; [Credit to buy clothes]; [Credit to acquire a movable property]; [Credit to pay debts]; [None of the above]; [I don´t know] | 0.90 | 1 | N |
FK-5 | Regulatory entity of the State that controls and monitors the financial activity in the country of banks, mutuals, and financial companies. [Superintendency of Companies]; [Superintendency of Banks of Ecuador]; [Superintendence of Popular and Solidarity Economy]; [Superintendency of market power control]; [None of the above]; [I don´t know] | 0.69 | 1 | N |
FK-6 | What are the financial services distribution channels? [Virtual Banking/Mobile/Telephone/Transactional]; [ATMS]; [Agencies and Counters]; [Call center]; [All of the above]; [I don´t know] | 0.95 | 1 | N |
FK-7 | What is defined as a demand deposit contract between the bank and the client, which allows one to earn interest? [Current account]; [Savings account]; [Policy]; [Insurance]; [None of the above]; [I don´t know] | 0.84 | 1 | N |
FK-8 | In what kinds of situations can insurance cover us? [Loss of household assets due to theft]; [Unplanned expenses on health issues]; [Loss of income for our family, in the event of death]; [All of the above]; [None of the above]; [I don´t know] | 0.58 | 2 | A |
FK-9 | Remittances are ….? [Money transfers made by private companies in the same country]; [Money transfers made by people in the same country]; [Money transfers made by people from one country to another]; [Money transfers made by public companies in the same country]; [None of the above]; [I don´t know] | X | 4 | A |
FK-10 | Who is the customer advocate? [It is a support for clients in the face of any problem related to financial products and/or services]; [It is a mediator between the user and the Financial Institution]; [It is a protector of the particular rights and interests of the clients of a financial institution]; [All of the above]; [None of the above]; [I don´t know] | 0.43 | 1 | N |
FB (1 Never–5 Always). α 0.956 | ||||
FB-1 | When you apply to a credit do you know what INSURANCE you are paying? | 0.94 | 5 | A |
FB-2 | Do you create a monthly budget for personal expenses. | 0.95 | 3 | A |
FB-3 | Do you choose products in an informed way. | 0.96 | 3 | A |
FB-4 | Do you prefer to buy assets with your own savings rather than to go into debt. | 0.89 | 2 | A |
FB-5 | Do you frequently save at least a minimum percentage of your income. | 0.94 | 7 | A |
FA (1 Strongly disagree- 5 Completely agree). α 0.630 | ||||
FA-1 | Do you consider that you have extensive knowledge of the products offered by FI? | 0.81 | 3 | A |
FA-2 | Do you consider that saving is a positive exercise for your financial growth? | 0.64 | 3 | A |
FA-3 | Do you consider that keeping a record of income, expenses, and debts is important? | 0.72 | 2 | A |
FA-4 | Do you rely on transactional channels to enter passwords and inquire about financial products/services? | 0.77 | 4 | A |
FA-5 | Are you are willing to risk some of your own money when making an investment? | 0.79 | 6 | C |
α Cronbach´s alpha (Cronbach 1951) | ||||
X: Deleted Items after Correlational analysis. This scale based on seven formal studies.
|
FL | FK | FB | FA | Gender | Age | Marital Status | Educational Level | Occupation | |
---|---|---|---|---|---|---|---|---|---|
FL | 1.00 | ||||||||
FK | 0.86 *** | 1.00 | |||||||
FB | 0.88 *** | 0.54 *** | 1.00 | ||||||
FA | 0.86 *** | 0.58 *** | 0.81 *** | 1.00 | |||||
Gender | −0.04 | −0.11 | 0.04 | 0.00 | 1.00 | ||||
Age | 0.72 | 0.54 | 0.76 | 0.62 | 0.08 | 1.00 | |||
Marital status | 0.64 | 0.43 | 0.66 | 0.63 | 0.10 | 0.88 | 1.00 | ||
Educational level | 0.72 | 0.54 | 0.76 | 0.58 | 0.06 | 0.77 | 0.43 | 1.00 | |
Occupation | −0.49 | −0.41 | −0.52 | −0.33 | −0.09 | −0.61 | −0.19 | −0.80 | 1.00 |
Source | Type II Sum of Squares | df | F-Statistic | p-Value | ηp2 | Post Hoc Comparisons-Bonferroni | |
---|---|---|---|---|---|---|---|
FL | Groups | 5.99 | 3 | 188.12 | 0.000 *** | 0.64 | HS < CE HS < GP HS < FIE CE = GP CE < FIE GP < FIE |
Residuals | 3.29 | 310 | |||||
FK | Groups | 9.45 | 3 | 81.76 | 0.000 *** | 0.44 | HS < CE HS < GP HS < FIE CE = GP CE < FIE GP = FIE |
Residuals | 11.94 | 310 | |||||
FB | Groups | 9.83 | 3 | 163.57 | 0.000 *** | 0.61 | HS < CE HS < GP HS < FIE CE = GP CE < FIE GP < FIE |
Residuals | 6.21 | 310 | |||||
FA | Groups | 1.52 | 3 | 68.37 | 0.000 *** | 0.40 | HS < CE HS < GP HS < FIE CE = GP CE < FIE GP < FIE |
Residuals | 2.29 | 310 |
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Trial | Model 1 | Model 2 | Model 3 |
---|---|---|---|
Applied co-variances | -- | FK~~FA FB~~FA FK~~FB | FK~~FA FB~~FA FK~~FB FK2~~FK3 FB4~~FB5 |
Chi-square (value) | 2.062,77 | 1.450,66 | 1.436,45 |
Chi-square (p-value) | 0.000 *** | 0.000 *** | 0.000 *** |
Degrees of freedom | 133 | 130 | 128 |
Chi-square/Degrees of freedom | 15.51 | 11.16 | 11.22 |
GFI-Goodness of fit index | 0.984 | 0.990 | 0.990 |
CFI-Comparative fit index | 0.984 | 0.991 | 0.991 |
NFI-Normed fit index | 0.984 | 0.990 | 0.990 |
TLI-Tucker–Lewis’s index | 0.982 | 0.989 | 0.989 |
SRMR- Standardized Root mean square residual | 0.294 | 0.279 | 0.278 |
RMSEA-Root mean square error of approximation | 0.313 | 0.244 | 0.244 |
Subscale | Items | α | ω | AVE |
---|---|---|---|---|
FL | 18 | 0.908 | 0.962 | 0.745 |
FK | 8 | 0.794 | 0.894 | 0.706 |
FB | 5 | 0.956 | 0.962 | 0.946 |
FA | 5 | 0.630 | 0.808 | 0.605 |
Hypothesis | Path | Estimate | p-Value | Decision |
---|---|---|---|---|
H1 | FL ← FK | 0.43 | 0.000 *** | Supported |
H2 | FL ← FB | 0.28 | 0.000 *** | Supported |
H3 | FL ← FA | 0.29 | 0.000 *** | Supported |
FL | FK | FB | FA | |||||
---|---|---|---|---|---|---|---|---|
M | SD | M | SD | M | SD | M | SD | |
HS | 59 | 0.07 | 55 | 0.16 | 49 | 0.05 | 72 | 0.08 |
CE | 82 | 0.13 | 86 | 0.26 | 78 | 0.20 | 83 | 0.10 |
GP | 83 | 0.14 | 89 | 0.23 | 78 | 0.20 | 82 | 0.11 |
FIE | 96 | 0.02 | 99 | 0.03 | 98 | 0.02 | 93 | 0.03 |
Source | Type II Sum of Squares | df | F-Statistic | p-Value | ηp2 | Post Hoc Comparisons-Bonferroni |
---|---|---|---|---|---|---|
Age | 5.46 | 3 | 147.45 | 0.000 *** | 0.59 | 15–20 < 21–26 15–20 < 27–32 15–20 < 33–50 21–26 = 27–32 21–26 < 33–50 27–32 = 33–50 |
Residuals | 3.83 | 310 | ||||
Marital status | 2.24 | 3 | 32.80 | 0.000 *** | 0.24 | Single < Married Single < Free Union Single = Divorced Married = Free Union Married = Divorced Free Union = Divorced |
Residuals | 7.05 | 310 | ||||
Educational level | 5.76 | 3 | 169.20 | 0.000 *** | 0.62 | High school < Higher technological level High school < Third level, grade High school < Fourth level, postgraduate Higher technological level < Third level, grade Higher technological level = Fourth level, postgraduate Third level, grade > Fourth level, postgraduate |
Residuals | 3.52 | 310 | ||||
Occupation | 6.50 | 4 | 180.67 | 0.000 *** | 0.70 | Housewife/Househusband = Public Employee Housewife/Househusband < Private Employee Housewife/Househusband < Microentrepreneur Housewife/Househusband = Does not apply Public Employee < Private Employee Public Employee < Microentrepreneur Public Employee = Does not apply Private Employee < Microentrepreneur Private Employee > Does not apply Microentrepreneur > Does not apply |
Residuals | 2.78 | 309 |
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Méndez-Prado, S.M.; Rodriguez, V.; Peralta-Rizzo, K.; Everaert, P.; Valcke, M. An Assessment Tool to Identify the Financial Literacy Level of Financial Education Programs Participants’ Executed by Ecuadorian Financial Institutions. Sustainability 2023, 15, 996. https://doi.org/10.3390/su15020996
Méndez-Prado SM, Rodriguez V, Peralta-Rizzo K, Everaert P, Valcke M. An Assessment Tool to Identify the Financial Literacy Level of Financial Education Programs Participants’ Executed by Ecuadorian Financial Institutions. Sustainability. 2023; 15(2):996. https://doi.org/10.3390/su15020996
Chicago/Turabian StyleMéndez-Prado, Silvia Mariela, Vanessa Rodriguez, Kevin Peralta-Rizzo, Patricia Everaert, and Martin Valcke. 2023. "An Assessment Tool to Identify the Financial Literacy Level of Financial Education Programs Participants’ Executed by Ecuadorian Financial Institutions" Sustainability 15, no. 2: 996. https://doi.org/10.3390/su15020996
APA StyleMéndez-Prado, S. M., Rodriguez, V., Peralta-Rizzo, K., Everaert, P., & Valcke, M. (2023). An Assessment Tool to Identify the Financial Literacy Level of Financial Education Programs Participants’ Executed by Ecuadorian Financial Institutions. Sustainability, 15(2), 996. https://doi.org/10.3390/su15020996