<abstract xmlns="http://www.w3.org/1999/xhtml"><p>In rural Kazakhstan, the credit and insurance services are limited and the state support is weak. Therefore, households’ saving is crucial to provide an insurance against the economic and social shocks. The main goal of this study is to contribute to the literature on financial literacy in emerging economies, namely, the effect of financial literacy on saving rates of rural population. Being well educated not always means to be financial literate and make efficient decisions regarding one’s own finance. People with a lower formal education level but with better experience in consuming financial products could be better prepared for making financial decisions including those related to savings. In this paper other socio-economic determinants of saving rates were taken into account, such as an income level, family size and an employment status. This research was carried out in Pavlodar region of Kazakhstan, and the data collection took place in spring 2014. In total, 405 households were surveyed. Results of the analysis show that if a respondent gives at least one correct answer, it positively affects the saving rates as well as one can observe that the higher the financial literacy level, the higher are the saving rates. Availability of state supported financial education programs for rural people will significantly contribute to the financial literacy improvement. At the same time, providing various and appropriate financial products in rural areas will motivate rural people to search for new knowledge and require authorities to intensify activities in this field.</p></abstract>

In rural Kazakhstan, the credit and insurance services are limited and the state support is weak. Therefore, households’ saving is crucial to provide an insurance against the economic and social shocks. The main goal of this study is to contribute to the literature on financial literacy in emerging economies, namely, the effect of financial literacy on saving rates of rural population. Being well educated not always means to be financial literate and make efficient decisions regarding one’s own finance. People with a lower formal education level but with better experience in consuming financial products could be better prepared for making financial decisions including those related to savings. In this paper other socio-economic determinants of saving rates were taken into account, such as an income level, family size and an employment status. This research was carried out in Pavlodar region of Kazakhstan, and the data collection took place in spring 2014. In total, 405 households were surveyed. Results of the analysis show that if a respondent gives at least one correct answer, it positively affects the saving rates as well as one can observe that the higher the financial literacy level, the higher are the saving rates. Availability of state supported financial education programs for rural people will significantly contribute to the financial literacy improvement. At the same time, providing various and appropriate financial products in rural areas will motivate rural people to search for new knowledge and require authorities to intensify activities in this field.

Financial Literacy of Rural Population as a Determinant of Saving Behavior in Kazakhstan

Rural Sustainability Research

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

In rural Kazakhstan, the credit and insurance services are limited and the state support is weak. Therefore, households’ saving is crucial to provide an...

Financial Literacy of Rural Population as a Determinant of Saving Behavior in Kazakhstan

Published Online: Nov 10, 2017

Page range: 32 - 42

DOI: https://doi.org/10.1515/plua-2017-0010

Keywords
finance, literacy, rural, savings rate, credit

© 2017 Sholpan Gaisina et al., published by De Gruyter Open

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Financial Literacy of Rural Population as a Determinant of Saving Behavior in Kazakhstan

Published Online: Nov 10, 2017

Page range: 32 - 42

DOI: https://doi.org/10.1515/plua-2017-0010

Keywordsfinance, literacy, rural, savings rate, credit

© 2017 Sholpan Gaisina et al., published by De Gruyter Open

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Keywords
finance, literacy, rural, savings rate, credit