ANZ Chief Executive Officer Mr Mike Smith said the 2008 survey provided further evidence there was a pronounced difference in financial literacy levels between the most financially literate (top 20 per cent) of the Australian population and the least financially literate (bottom 20 per cent).
“The effects of low financial literacy come at a great cost to the economy, and to the livelihood of Australian families and individuals. For example, according to the Australian Bureau of Statistics last year Australians lost nearly $1 billion falling victim to fraud and scams,” Mr Smith said.
“Added to this, the current global financial turmoil highlights the importance of responsible lending, good advice and sound money management. Financial institutions, governments, regulators and community organisations have a shared interest in equipping individuals with the knowledge and confidence they need to make sound financial decisions that contribute to both their personal, and the entire system’s financial stability.
“Clearly, the sorts of improvements we all want to see require a long-term effort by all stakeholders, and perhaps one positive outcome of the current turmoil will be a refocussing on these issues,” Mr Smith said.
Mr Smith said ANZ supported the Federal Government’s decision last week to move to national regulation of credit.
“A more uniform approach to credit regulation will provide increased transparency and improved safeguards for consumers. Effective regulation that strikes the right balance between imposing increased costs on financial institutions and protecting consumers can also play a part in promoting good decision-making by both consumers and financial institutions,” Mr Smith said.
For its part, ANZ will continue to focus on making its products simple to understand and offering them in a transparent and responsible manner to ensure customers can easily make informed choices.
“We also need to continue to make a special effort for the most disadvantaged consumers in the community. For those most at risk ANZ has made a major commitment by developing financial literacy programs delivered by our community partners.
“I don’t underestimate the magnitude of this task but I am sure that our sector, working with government, regulators and community stakeholders, can make a difference,” Mr Smith said.
The ANZ 2008 Financial Literacy Research was launched in Melbourne today by ANZ Chief Executive Officer, Mike Smith, Federal Minister for Superannuation and Corporate Law, Senator Nick Sherry and Australian Securities and Investment Commission (ASIC) Chairman, Tony D’Aloisio.