ACCI Conference 2018

Angela C. Lyons, John E. Grable, Ting Zeng - Government leaders around the world are designing national strategies to improve financial inclusion for populations traditionally excluded from the financial markets. Financial literacy is a key tool being used to bring economically vulnerable populations into the financial mainstream. We use data from the 2013 Chinese Household Finance Survey (CHFS) to investigate the impacts of various dimensions of financial literacy on the demand for bank and non-bank loans among rural, illiterate, and migrant populations in China. The findings show that those groups most vulnerable may be less likely to be positively impacted by financial literacy, especially when it comes to access to formal bank loans. Moreover, other factors such as those related to social networks and infrastructure may matter more than financial literacy.