> Posted by Gabriela Zapata, Independent Consultant

With so much hype around and support for financial education initiatives in Mexico in recent years, CFI’s and JPMorgan Chase & Co.’s project on innovations in financial capability-building provides a great opportunity to see who is actually moving the needle (or not) in favor of developing financial capability in Mexico.

Here, the terms financial capability and financial education are often used interchangeably. While the ultimate aim of these closely related efforts is to enable people to make informed and better decisions around financial products and services, the positive behavior change that is sought from these efforts, with very few exceptions, is neither clearly defined from the outset nor measured.

Most initiatives in Mexico fall under what I would call “classic” financial education, focusing on information dissemination, either classroom-based or online, primarily on generic topics (e.g. savings, credit, insurance, interest rates, credit card, etc.), money management, and budgeting/planning. Unsurprisingly, it is much easier to account for their activities and outputs (e.g. type and number of courses and materials developed; number of courses given; number of attendees) than to measure their impact on decision-making. Only a few undertakings measure knowledge acquisition or learning levels right after the intervention, and they have no way of knowing how, in practice, the learning informs consumer decision-making going forward.

This raises the question: what difference have all these programs and investments actually made in anyone’s financial lives? Developing financial capability implies behavior change, and the only way to know whether you’ve accomplished it is by knowing what behavior you want to see and finding ways to measure it. Otherwise, we may be full of good intentions but how can we know for sure that our intentions are materializing into positive financial behavior?

While the financial capability landscape in Mexico remains sparse, some provider initiatives are beginning to show promise. They are beginning to acknowledge, to varying degrees, the importance of generating positive behavior change among financial services’ users, be it for the clients’ own benefit, the providers’ profitability, or both.

Amongst the largest financial education platforms in Mexico are those of BBVA Bancomer, Banamex, and BancoAzteca, which are variations on one-way information delivery mechanisms to the public. At the time when the study was conducted, none of them were measuring these programs in relation to value for new business but they did express interest in understanding the efficacy of their programs and have begun to take initial steps towards measuring behavior change.  The business side of these banks is already experimenting with capability-building efforts built into product delivery, and these are among the most innovative aspects of their financial capability work that will be worth following in the future (more on these innovative aspects in the report).

Additionally, dotting the Mexican landscape are a number of innovative service providers—both financial service providers and independent technology platforms—that enhance the provision and uptake of financial services and can be leveraged to help clients understand, visualize, and manage their finances. All are relatively recent initiatives and none have yet reached scale but they show promise, such as kubo.financiero, kiwi, and ZaveApp, to name a few.

However well-intentioned most government and private–led efforts to promote financial education may be, it is time to move away from only counting the numbers of financial education kits produced, courses held, and people trained and move into generating intentional, tangible, and measurable differences in people’s financial lives, by helping them develop the capabilities that will enable them to make the right financial choices at the right time.

To access the CFI’s financial capability project, click here, and for the project’s review of interventions in Mexico, click here.   

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