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Making the case for Financial Literacy – What is CMF doing to address the FE challenges? (PART II)



In Part 1 of this blog, we discussed some of the challenges related to implementing an FE intervention.  These include high costs related to providing FE in a classroom setting, logistics and material costs, building the capacity of the staff to run the FE sessions; limited evidence about the impact of FE; no benchmark on what FE should contain; and inability to parse the effects of FE vs. advertising (enthusiasm) effect that comes with introducing financial services in unbanked areas.

CMF has evaluated FINO’s FE program, and conducted FE for Sonata clients using the rigorous RCT approach; CMF has assessed FE programs provided by 20 institutions; and CMF is currently designing an FE program for EKO’s clients in 7 districts of Bihar; the program is being rigorously piloted in both Uttar Pradesh and Bihar. Based on this extensive experience, CMF aims to find ways to reduce the cost of the FE sessions, make the content more targeted and succinct, determining which key messages have the greatest impact, and capturing the impact of FE:

  1. Cost – We have reduced the content of the FE sessions, ensuring that the critical messages about savings, expenses, banking institutions are intact, keeping the following in mind:
    • Short sessions, small groups – The module consists of 4-5 weekly sessions, which are 30 minutes in length.  We experienced that client tend to lose interest if the sessions are longer, and 4-5 weekly sessions is something clients can commit to compared to anything longer. Each of the sessions can be conducted in a medium sized groups (10-15 clients in pairs), or a small group (5-9 clients).  We experienced that a trainer can effectively work one-on-one with a client group that’s between 4-5 clients (or client pairs). 
    • Targeted messages – CMF has developed glossy and interactive flipcharts which trainers will carry; no additional equipment is necessary. Clients are provided with an expense analysis sheet (also called a diary) and a budgeting sheet so that they can better understand their expenses and how to increase their savings using their expense data. These short sessions are carefully designed to focus of key messages that have a profound impact on clients – such as describing the importance of compound interest, the concept of losing out on interest when starting savings late in life and so on.  
    • Estimated costs – The sessions are currently free. CMF aims at developing materials that can be used by any intuition after training trainers in the local language. There aren’t many worksheets for clients to fill out, and expected to be cheap to implement. However, CMF is trying to estimate the cost of these trainings in case they are replicated in other areas with other institutions.
    • Interactive sessions – Sessions are not as didactic in nature, but interactive.  The clients are encouraged to participate by use of stories, question / answers and a discussion session post FE. Each client works one-on-one with the trainer to design their savings goals, analyze their expenses and determine a savings amount and savings instrument that works best for them.
  2. Capturing the impact of FE – CMF conducted the Baseline (ended in July 2012) to understand the current savings behavior, will conduct interviews post FE to understand the client’s knowledge retention, and then conduct an Endline (around July 2013) to understand the impact of FE on the savings behavior.  In addition, CMF will also conduct a Process Evaluation survey to assess the knowledge level of the clients, and evaluate the experience of clients and trainers post the FE sessions. After analyzing these results, CMF will be able to determine the effect of FE on savings behavior for these clients. CMF will also document and disseminate these findings for other institutions interested in impact of FE. CMF has conducted similar rigorous analysis for the FINO and Sonata FE programs, and the results are available for institutions and practitioners.
  3. Creating benchmark for FE – CMF wants to determine the critical messages that have an impact on the client, so that FE modules are standard and succinct. CMF also intends to test whether modules being used in the EKO project can be easily adapted in other languages and other regions. In addition, CMF will test how easy it is for other organizations to implement an FE program using these modules. The results from all these findings can help CMF work towards creating a standard template for FE, which other organizations can replicate or adapt.
  4. Parsing the Advertising vs. FE Effect – Currently, the EKO study is not designed to answer this question, however, we hope to learn more from the clients about the advertising effect through detailed questions during the survey. 


While classroom FE may not be sustainable in the long run due to cost and capacity constraints, there are ways to make FE more effective. Existing knowledge from FINO and Sonata evaluations, in addition to the EKO evaluation, will give CMF a better understanding about how to make FE a more concise, cost-efficient and effective for clients who have limited access to and limited knowledge and awareness about financial products and services.



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  1. good series of posts on financial literacy. Really helpful

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