Creating Informed Consumers: Tracking Financial Literacy Programs in Indonesia
Not all financial consumers are equipped with the necessary knowledge of the products and services that they are using. A wide gap exists between the level of financial inclusion (76.19%) and financial literacy (38.03%) in Indonesia. The wide gap between the level of financial inclusion and financial literacy in Indonesia suggests that some consumers do not have adequate knowledge about the products or services they are using and this could lead them to make poorly-informed financial decisions, incur too much debt, or even fall victim to illicit investment products. In the long run, these problems may damage consumer trust in financial services, which could hamper growth in the financial sector.
This paper attempts to track financial literacy efforts by both the Indonesia’s Financial Authority Services (Otoritas Jasa Keuangan, or OJK) and Financial Services Institutions (FSIs), and recommends practical solutions to improve their impact in creating informed financial consumers in Indonesia.