South Africa ranks last in global financial literacy study

South Africa has ranked last in a new international financial literacy study, with respondents answering an average of 69.4% of questions correctly.

However, the findings also point to strong support for improving money education, with 98.5% of South African participants believing financial education should be compulsory for school-age children.

The research, conducted by digital financial services provider Remitly, surveyed more than 5 000 people across 27 countries to assess their understanding of everyday financial concepts, including interest rates, compound interest, inflation, currency conversion, investing and cryptocurrency.

The results place South Africa 27th, behind the United Arab Emirates in 26th position with 70.8%, and the United States in 25th with 72%.

The Czech Republic topped the ranking, with participants answering 90.9% of the questions correctly, as the Netherlands followed in second place at 86.1%, while Norway secured third with 84.3%.

European countries dominated the top 10, with Finland, Austria, Belgium, Germany, Sweden, Hungary and the United Kingdom also making the list.

Australia was the highest-ranked country outside Europe, placing 11th with a score of 79.5%.

South Africa’s result highlights a gap between its respondents’ performance and that of the countries leading the study. The findings do not, however, suggest that every South African lacks financial knowledge, but rather provide an overall comparison of the surveyed participants.

A call for financial education to start at school

One of the study’s central findings was the widespread belief that formal education does not adequately prepare people to manage their finances as adults.

Across all 27 countries, 70.5% of respondents said their school education had not equipped them with enough knowledge to handle money confidently. In response, 93.6% supported making financial education compulsory for school-age children.

South Africa recorded an even higher level of support, with 98.5% of local respondents backing the proposal.

When asked which subjects were most important, budgeting and saving came out on top globally, identified by 75.1% of participants. This was followed by taxes at 55.2%, investing at 53.9%, debit and credit at 48.4%, and mortgages at 29.7%.

With many respondents feeling that their formal education fell short, the study found that people are increasingly taking responsibility for learning about personal finance themselves.

Some 82.9% said they were largely self-taught online, while 51.7% had used artificial intelligence tools such as ChatGPT for financial advice during the previous 12 months. A further 21.5% said AI tools were where they had learnt the most about money.

However, relying on online information also raises questions about the reliability of financial guidance, particularly when advice comes from social media personalities or influencers promoting particular products.

Martyn Saville, who is the Global Consumer Protection Manager at Remitly, said the findings point to a financial education gap that extends across countries and generations.

‘What stands out the most in this study is how universal the financial education gap is. Around 70% of people say school didn’t give them enough knowledge to manage their money, from everyday budgeting to bigger decisions like mortgages and investing. These are skills for life.’

He also cautioned consumers to consider who is behind financial advice shared online and whether the person providing it is qualified or being paid to promote a product.

‘There is plenty of free and reliable information out there, including from money charities, government and other reputable organisations. A few minutes researching today could save you a lot more money in the future.’

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**Picture: **Towfiqu barbhuiya/Pexels

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