In what is claimed as one of the most extensive measurements of global financial literacy to date, the Standard & Poor’s Ratings Services Global Financial Literacy Survey (S&P Global FinLit Survey) released this week finds that two-thirds of adults worldwide are not financially literate and there is a wide gap between men and women’s literacy, including in highly developed countries. The Nordic countries lead while Ireland lags countries such as the UK and Germany.


The survey results come from interviews conducted with more than 150,000 adults in more than 140 countries who were tested on their knowledge of four basic financial concepts: numeracy, interest compounding, inflation, and risk diversification. The data were collected in 2014 by Gallup as part of the Gallup World Poll and analytical support was provided by researchers at the World Bank Development Research Group and the Global Financial Literacy Excellence Center (GFLEC) at the George Washington University.

S&P says financial literacy rates vary widely across the European Union. On average, 52% of adults are financially literate, and the understanding of financial concepts is the highest in northern Europe. Denmark, Germany, the Netherlands, and Sweden have the highest literacy rates in the EU: at least 65% of their adults are financially literate.

Denmark, Norway and Sweden headed the rankings with each scoring 71%. They were followed by Israel and Canada, both of which scored 68%. Germany was at 66%; Australia was just behind at 64% and the US ranking was at 57%. Ireland was at 55% and France was at 52%.

Rates were lower in southern Europe than in the north. For example, in Greece and Spain, literacy rates are 45% and 49%, respectively. Italy and Portugal at 37% and 26%, have some of the lowest literacy rates in the south. Financial literacy rates are also low among the countries that joined the EU in 2004 and after. In Bulgaria and Cyprus, 35 percent of adults are financially literate. Romania, with 22% financial literacy, has the lowest rate in the European Union.

China was at 28% and Japan was at 43%.

At the bottom of the rankings were Yemen at 13%, Albania and Afghanistan were both at 14%, while Somalia and Angola were both at 15%.

One question: Suppose you need to borrow US$100 US dollars. Which is the lower amount to pay back: $105 or $100 plus three percent? [$105; $100 plus three percent; don’t know; refused to answer]

Financial Literacy around the World

financial literacy, Ireland, EU, Sweden