The OECD identifies a number of advantages in utilising digital formats for delivering financial education including:
- Ability to make the program interactive;
- adaptability to suit individual circumstances regarding time, format and space
- potential to appeal to younger markets;
- cheaper and easier to update information and include current policies or trends; and
Online delivery of financial education can be readily adapted to include multiple languages and facilitate the needs of people with vision or hearing impairments.
Accessing financial education online can also help reduce the social stigma which can be experienced by people if they feel uncomfortable about their financial situations or don’t wish to be seen as needing help with their finances.
Online delivery challenges
Designing programs for digital formats requires responsiveness to changes in devices, screen sizes and other technological functions. There will be the need for organisations delivering education in this format to keep up to date with links, policy changes and other trends that can impact the relevance of the content.
Moreover, while there is a narrowing in the digital divide due to the pervasiveness and reliance upon digital devices to meet social, business and consumer needs, there are still many groups who do not have access to digital devices and the internet or have low levels of digital literacy. This makes it important to continue offering a variety of methods to facilitate widespread access to financial education in the community.
Web-based and online delivery of financial education presents some challenges to capturing and responding to feedback unless there is live chat facility. Providing face-to-face financial education either in workshops or one-to-one allows the participant to ask questions in real time - and the instructor can readily gauge levels of participant understanding through interaction with the participant. As technology develops however, interactive features are increasingly offered through various platforms and these challenges can be overcome.
Evidence of effectiveness
The efficacy of online financial education modules needs more testing. There are limited evaluations available and the few studies there are primarily conducted with student populations in the US.
A study conducted with high school students in the US who completed an online module “Soar to Savings” showed significant improvements in student knowledge after doing the module. Similarly, a large study with US undergraduate students who completed an online course “Financial Literacy 101” between 2012 and 2017 also found the program increased students’ subjective knowledge.
One of the few non-student studies exploring online financial education was conducted in Columbia. The program was targeted to participants of a cash transfer program, mostly lower-income females. The randomised evaluation showed significantly positive impacts on participants’ knowledge, behaviours, attitudes and overall financial health. The effects of the program were found to have lasted approximately two years.
Related to but not the same as web-based financial education, the use of online forums has shown to be beneficial to people seeking financial information. Online Self-Organising Social Systems (OSOSS) can be a useful complementary mode to traditional financial education or other sources of financial information.
These are all promising indications of the opportunity for online education. As a complement to traditional delivery, online delivery is likely to be an increasingly important platform.
Roslyn Russell is a Professor in the School of Economics, Finance and Marketing at RMIT University