International Forum for Investor Education

National Strategies to Promote Financial Literacy

United Kingdom

The Financial Services Authority (FSA), the government regulator for the capital market in the UK, launched a National Strategy for Financial Capability in 2003 intended to increase financial capability in the UK by working with private sector stakeholders. The FSA and its partners define financial capability to include both knowledge about financial topics (often referred to as financial literacy) and the ability to put that knowledge into practice. The FSA and its private sector partners are focusing their efforts on seven specific priority areas: (1) schools; (2) young adults; (3) workplace; (4) families; (5) retirement; (6) borrowing; and (7) financial advice. As the FSA states in its website, the intent of this national campaign is to treat financial capability messages, "…like a commercial product that we want people to adopt and act upon. That means reaching out to individuals with innovative and imaginative marketing techniques and 'selling' them the idea that personal finance matters and that it need not be difficult." The FSA's website for the financial capability campaign can be found at: www.fsa.gov.uk/financial_capability.

Working closely with its private sector partners, the FSA has sponsored a large body of research in the area of financial literacy since the financial capability campaign was launched, including an exploratory qualitative study measuring financial capability in the UK. The individual research that has been funded by the FSA as part of its campaign to promote higher levels of financial capability in the UK can be found at: www.fsa.gov.uk/financial_capability/research/general.htm. In addition, the FSA has established an "innovation fund" that will provide support to new and innovative projects run by the voluntary sector and fund research looking at what works in delivering financial capability. In early 2006, awards were given from the Fund for projects run by twelve 'not for profit' organisations to help raise levels of financial capability among groups such as families on low incomes and people with learning disabilities.

In early 2006, the FSA announced that the next stage of its strategy would be to deliver a specific set of projects to promote financial capability in the seven priority areas that it had identified earlier, all of which were fully costed with firm plans for implementation. These projects will promote financial capability education for children and adults with information and advice reaching further into UK schools, higher education institutions and other organisations that help young people and adults. In the workplace, for example, the FSA will expand efforts to deliver material and seminars to employees of all ages across the UK. The aim is to ensure that 4 million employees will have had access to some form of financial guidance through their workplace by 2010, with half a million having attended a seminar. Further information and details on the specific initiatives for 2006 and 2007 can be found at: www.fsa.gov.uk/pages/Library/Communication/Speeches/2006/0222_ve.shtml.