The latest Financial Literacy Index on Monday revealed consumers in the United Arab Emirates (UAE) have become more financially prudent over time, with their overall financial literacy ranking standing at third position in the Middle East from 6th in 2010. The survey conducted by MasterCard also said that the UAE consumers were the most informed in the Middle East when it came to knowledge about investments.
The MasterCard Worldwide Index of Financial Literacy is based on a survey conducted between 24 April 2012 and 10 June 2012 with 11,376 respondents aged 18 – 64 in 25 countries. This is the 3rd survey of Financial Literacy conducted since 2010. The survey polled consumers on three aspects of financial literacy including their basic money management skills, investment knowledge and financial planning to determine the level of basic money management skills in terms of budgeting, savings, and responsibility of credit usage. The survey and its accompanying reports do not represent MasterCard’s financial performance.
Egypt stood at first with 69 index points whereas Saudi Arabia came at second with 62 index points. Lebanon stood fourth on the table closely followed by Oman with 59 index points.
UAE consumers ranked 3rd in the Middle East with a score of 61 index points in the MasterCard Index of Financial Literacy. Consumers in the Emirates scored well on the Index’s financial planning component (65%), and were particularly well prepared when it came to saving regularly and early financial planning. The financial planning scores were followed by basic money management (60%) and investment (57%). In fact, the UAE consumers’ score for investment know-how was the highest in the Middle East, and their score for financial planning (65%) was higher than the Middle East average (64%). In the investment component of the survey, consumers in the UAE showed good understanding of their financial statements and the suitability of financial products for their needs.
“It is encouraging to see that consumers in the UAE are becoming more financially aware and hence able to make responsible financial decisions for themselves and their families. Financial literacy is a key focus area for MasterCard, and we will continue to champion the cause with initiatives like the It’s My Business programme that we have launched with INJAZ Al-Arab to train Arab youth in work readiness, financial literacy and entrepreneurship,” said Eyad Al-Kourdi, vice president and country manager, UAE, MasterCard Worldwide.
Middle East highlights:
The Middle East’s aggregate financial literacy score decreased slightly from 63 index points in 2010 to 61 index points in 2012.
Consumers in the Middle East scored highest in terms of knowledge about financial planning (64%) followed by basic money management (62%) and investment (54%).
While slight disparities exist, men and women were largely on par in terms of financial literacy in the Middle East. In the UAE, men achieved marginally higher scores than women (63 vs. 59).
Age does not seem to significantly affect levels of financial literacy as respondents under 30 years of age as well as those over 30 years of age showed the same level of financial literacy (61 index points) in the Middle East.