Italy in figures

Financial literacy in Italy

According to a paper of the Bank of Italy, Italian adults still lag behind their international counterparts when it comes to financial literacy. The survey was conducted at the beginning of 2020 on a sample of 2,000 adults with an age ranging from 18 to 79.

February 25 2021
Reading time: 10 min

In Italy there is a wide variability of financial literacy amidst the population, depending on some important variables such as education – the most significant -, age, gender and geographical location. 

Italians can be divided in four groups, characterized by increasingly high levels of financial knowledge: excluded, incompetent, competent and expert. On average their financial literacy still ranks low if compared with other countries, though the 2020 survey shows signs of improvement compared to 2017.

In the paper, published in December 2020 by the Bank of Italy, financial literacy indicator is the sum of the scores calculated for three factors: knowledge, behaviour and attitudes (to know more, please read the glossary below the infopgraphic).

The paper is authored by Giovanni D’Alessio, Riccardo De Bonis, Andrea Neri and Cristiana Rampazzi. You can find it here

Are you curious to try answering to the questions used for the assessment of financial literacy in Italy? Go to page 25 of the paper.

The main outcomes of the survey are highlithed in the infographic below.

Financial literacy in Italy, 2020

Financial literacy in Italy: average score
Copied
Financial literacy in Italy: average score

The average level of financial literacy of Italians in 2020 is 11.2, on a scale  ranging from 1 to 21. The value is aligned with the one observed in 2017. 

The average level of financial literacy of Italians in 2020 is 11.2, on a scale  ranging from 1 to 21. The value is aligned with the one observed in 2017. 

image-1

Financial literacy and education
Copied
Financial literacy and education

The educational qualification of surveyed individuals is the most significant viariable impacting the overall financial literacy and all three of its components, especially knowledge and behavior. 
Italy low position in the OCSE ranking is explained, in part, by the lower levels of education of Italians  compared with other countries.

The educational qualification of surveyed individuals is the most significant viariable impacting the overall financial literacy and all three of its components, especially knowledge and behavior. 
Italy low position in the OCSE ranking is explained, in part, by the lower levels of education of Italians  compared with other countries.

image-1

Financial literacy and age
Copied
Financial literacy and age

Financial literacy is highest between the ages of 35 and 44; it is low in people under 35 , also because young people in Italy leave their families of origin late.

Italy low position in the OCSE ranking is explained, in part, by the higher share of elderly people compared with other countries.

Financial literacy is highest between the ages of 35 and 44; it is low in people under 35 , also because young people in Italy leave their families of origin late.

Italy low position in the OCSE ranking is explained, in part, by the higher share of elderly people compared with other countries.

image-1

Financial literacy and gender
Copied
Financial literacy and gender

The literacy of men is confirmed as being higher than that of women .
The gap between men and women is particularly strong in regards to knowledge, especially among those with low educational qualifications.

The literacy of men is confirmed as being higher than that of women .
The gap between men and women is particularly strong in regards to knowledge, especially among those with low educational qualifications.

image-1

International comparison
Copied
International comparison
  1. In 2020 Italy is confirmed at the bottom of the international ranking, as it was in 2017.
  2. Financial literacy in Italy is compared with other twenty-six countries participating in the OECD/INFE 2020 International Survey of Adult Financial Literacy. These 26 countries include 12 OECD members.
  3. The 26 countries participating in the 2020 wave have an average score of 12.7 - 13 for OECD countries - while Italy score is 11.2.
  4. Comparisons across countries must be considered with caution, as the surveys are not fully harmonized.

  1. In 2020 Italy is confirmed at the bottom of the international ranking, as it was in 2017.
  2. Financial literacy in Italy is compared with other twenty-six countries participating in the OECD/INFE 2020 International Survey of Adult Financial Literacy. These 26 countries include 12 OECD members.
  3. The 26 countries participating in the 2020 wave have an average score of 12.7 – 13 for OECD countries – while Italy score is 11.2.
  4. Comparisons across countries must be considered with caution, as the surveys are not fully harmonized.
image-1

Four groups of Italians
Copied
Four groups of Italians

By conducting an econometric exercise on financial knowledge, Italians were classified into four categories:

  1. the excluded, whose share in 2020 is equal to 21% of the Italian population;
  2. the incompetent, 30%;
  3. the competent, 32%;
  4. the expert, 17%.

With respect to 2017, the percentages of excluded and incompetent  individuals fell, against an increase in the shares of competent and, to a small extent, expert individuals.

By conducting an econometric exercise on financial knowledge, Italians were classified into four categories:

  1. the excluded, whose share in 2020 is equal to 21% of the Italian population;
  2. the incompetent, 30%;
  3. the competent, 32%;
  4. the expert, 17%.

With respect to 2017, the percentages of excluded and incompetent  individuals fell, against an increase in the shares of competent and, to a small extent, expert individuals.

image-1

Glossary

1. Knowledge. The questions concern the understanding of the basic relationships useful for making financial choices: inflation, interest rates, difference between simple and compound interest rates and risk diversification.
2. Behaviour. The questions refer to the management of financial resources in the short and long term: setting financial objectives, planning of resources to be used for consumption, bill payments and savings in recent months.
3. Attitude. The questions reveal the orientation of individuals towards saving, especially precautionary saving, in a long-term perspective.

Sample

The survey was conducted by a specialized company between January and February 2020, before the outbreak of the COVID-19 pandemic. The interviews were conducted by professional interviewers on a sample consisting of about 2,000 adults, aged between 18 and 79.