Malaysia’s overall financial literacy ranking has improved from 9th in 2010 to 6th, with a score of 68 index points out of 100, according to the latest MasterCard Worldwide Index of Financial Literacy survey.
Measured on three major components of basic money management, financial planning and investment, Malaysia demonstrated an overall increase in all three categories, said MasterCard in a press release.
In terms of overall financial literacy, Taiwan and New Zealand led the region, with Taiwan jumping from 5th position in 2010 to a score of 73 index points out of 100, the same as New Zealand.
Coming in third with 71 index points is Hong Kong, up from 6th when the survey was conducted in 2010. Japan and India ranked bottom of the financial literacy rankings with 60 index points each.
Malaysia moved up one spot from 8th in 2010 to 7th in 2012 under the basic money management component, consisting of day-to-day budgeting, keeping up with bills, credit commitments and settling money aside for big purchases. New Zealand ranked the highest among the other countries within this category.
Under the investment component of the research, Malaysia moved up a four spots from 11th in 2010 to 7th in 2012. More respondents in these markets understood their bank statements and complex investment concepts such as diversification and inflation. Hong Kong ranked the highest within this component.
In the release, Malaysia & Brunei MasterCard Worldwide vice-president & senior country manager Jim Cheah said the MasterCard Worldwide Financial Literacy Index shows an improvement in Malaysia’s financial understanding.
“Saving, budgeting and investing are all important aspects of financial management. It is encouraging to know that Malaysians are responsible when it comes to day-to-day financial planning,” he said.
The MasterCard Worldwide Index of Financial Literacy is based on a survey conducted between April 24 and June 10 this year, with 6,904 respondents aged 18 to 64 in 14 Asia-Pacific market countries.
This is the third survey of financial literacy conducted since 2010. The survey polled consumers on three aspects of financial literacy including their basic money management skills, investment knowledge and financial planning to determine the level of basic money management skills in terms of budgeting, savings, and responsibility of credit usage.