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Financial Literacy in Cyprus: Results from the first comprehensive Central Bank of Cyprus survey

Author

Listed:
  • George A. Kyriacou

    (Central Bank of Cyprus)

  • Theodosis L. Kallenos

    (Central Bank of Cyprus)

  • Ioanna S. Evangelou

    (Cyprus University of Technology)

  • Lena T. Cleanthous

    (Central Bank of Cyprus)

  • Charis P. Charalambous

    (Central Bank of Cyprus)

Abstract

The paper evaluates financial literacy levels in Cyprus, drawing on data from the 2018 Financial Literacy Sampling Survey conducted by the Central Bank of Cyprus. The survey included 1,000 participants aged 18 to 79. The questionnaire covered two sections: sociodemographic information and general financial behaviour, and financial knowledge, attitude, and behaviour, based on the OECD/INFE Toolkit. A key finding of the survey was that the average financial knowledge score in Cyprus was 4.78 out of 7, falling short of the OECD's benchmark for someone to be considered as financially literate, which is 5 out of 7. The survey results highlighted specific groups in greater need of financial education, including young people, the unemployed, women, low-income individuals, those with lower educational attainment, and citizens who did not take economics courses during secondary education. Additionally, lower financial knowledge was associated with greater financial vulnerability. Notably, significant financial knowledge gaps were found in areas such as interest compounding and risk diversification. These findings were instrumental in developing Cyprus's first National Strategy to promote financial literacy and education, endorsed by the Council of Ministers in June 2022. A follow-up survey is currently underway to reassess financial literacy in Cyprus.

Suggested Citation

  • George A. Kyriacou & Theodosis L. Kallenos & Ioanna S. Evangelou & Lena T. Cleanthous & Charis P. Charalambous, 2024. "Financial Literacy in Cyprus: Results from the first comprehensive Central Bank of Cyprus survey," Working Papers 2024-2, Central Bank of Cyprus.
    • Handle: RePEc:cyb:wpaper:2024-2
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    References listed on IDEAS

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    1. Panayiotis C. Andreou & Dennis Philip, 2018. "Financial knowledge among university students and implications for personal debt and fraudulent investments," Cyprus Economic Policy Review, University of Cyprus, Economics Research Centre, vol. 12(2), pages 3-23, December.
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    3. Adele Atkinson & Flore-Anne Messy, 2012. "Measuring Financial Literacy: Results of the OECD / International Network on Financial Education (INFE) Pilot Study," OECD Working Papers on Finance, Insurance and Private Pensions 15, OECD Publishing.
    4. Ali Coskun & Nurdilek Dalziel, 2020. "Mediation effect of financial attitude on financial knowledge and financial behavior: The case of university students," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 9(2), pages 01-08, March.
    5. Cupák, Andrej & Fessler, Pirmin & Schneebaum, Alyssa & Silgoner, Maria, 2018. "Decomposing gender gaps in financial literacy: New international evidence," Economics Letters, Elsevier, vol. 168(C), pages 102-106.
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    More about this item

    Keywords

    financial literacy; financial behaviour; financial knowledge; financial fragility;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • G1 - Financial Economics - - General Financial Markets
    • G53 - Financial Economics - - Household Finance - - - Financial Literacy
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid

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