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Financial literacy and its role in promoting a sound financial system.

This article discusses the importance of financial literacy. Financial literacy--the ability to make informed judgements and decisions regarding the use and management of money--is important for individual consumers of financial services, the financial system and the wider economy. It influences how people save, borrow, invest and manage their financial affairs. It therefore affects their capacity to grow their wealth and income, and has significant implications for people's lifestyle choices. Financial literacy also has a significant part to play in influencing how financial institutions--such as banks, non-bank deposit takers and insurers--manage their affairs and what products they ...

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