National Financial Capability Study Project Update

Bank of Papua New Guinea

National Financial Capability Study Project Update

The Bank of Papua New Guinea (BPNG), together with the World Bank launched the National Financial Capability Study (NFCS) in November 2013. The Institute of National Affairs (INA) was contracted to carry out the survey work with technical support from the World Bank and overall oversight by the BPNG. Funding for the project was secured from the World Bank – Korean Trust Fund.

The NFCS was supposed to be carried out in eight provinces in the country. These were; Morobe, Madang, Western Highlands, Jiwaka, Eastern Highlands, East New Britain, Central and NCD. Due to difficulties with logistics to very remote areas and budget constraints the sample size was reduced to cover only Morobe and Madang(Momase).

Completion of Data Collection

Data collection for Momase has now been completed and all data has been either uploaded or entered manually and received by the WB Consultant who has commenced data compilation and analysis work. To uphold quality and data integrity the manual data entry was checked by the WB Consultant before they were uploading. BPNG also conducted a quality audit of the survey itself.

A summary of data collected has been presented to BPNG. Overall 759 surveys were collected from 40 Census Units (CU’s) – 95% of the target. It was not possible to reach four very remote CU’s and additional sampling was undertaken in four urban CU’s in Madang. If these surveys are excluded 688 surveys were completed – 86% of the target for the sampled CU’s.

Overall the quality of data collected is very high and a comprehensive data set has been assembled comprising location, household and financial information. The data set will provide a basis for further surveys and is also a rich data set for ongoing analysis.

The data collection modality used for the survey was successful and enabled very high quality data collection, including data collection in very remote locations, at moderate cost.

The NFCS Steering Committee (SC) thanked the INA Project Manager and field teams for their commitment to the project and the quality of the data collected for Momase. Once funding is secured the survey will be rolled out to the other six provinces.

Outputs from the Momase data have been agreed to by the SC:

Report and Dissemination Workshops

The report will be completed and dissemination workshops will be held in Port Moresby, Lae and Madang. The target date for the completion of the draft report is end April 2015. The workshops are planned for May.

The report focus and structure has been discussed and agreed to by the SC. The report will focus on Momase as a regional case study. General characteristics and differences will be analysed focusing on gender, location (and within this context Income levels/ livelihood), and age group.

Data Collection Workshop

The data collection modality (off-line app based data collection using tablets) enabled data to be collected efficiently and effectively across Momase, including very remote locations. This survey has demonstrated that it is possible to collect data effectively in PNG at reasonable unit cost, even in very remote locations. The data collection modality may have broader application for surveys in PNG, in particular larger scale surveys and surveys in remote locations. The possibility of BPNG (and INA) holding a seminar for agencies engaging in survey based data collection to discuss tablet based data collection was recommended.

Expected Outcome

The NFCS survey results for Momase will help in developing a national baseline across income groups in PNG on financial capability. The survey results for Momase are expected to provide a comprehensive understanding of financial capability of the Momase population, including the decision making on money management, financial planning habits, and use of informal and formal financial services.

This survey results will also provide important information on the management of money and the use of financial services by households in Momase at the rural and urban, lower income and higher income, inland and coastal areas.

The results of the survey will also provide useful information to support the Government in developing targeted financial inclusion, financial education, financial literacy and consumer protection programs for the PNG population to support inclusive economic growth in PNG.

Financial Inclusion Agenda

The NFCS is an integral part of the Financial Inclusion program initiated by BPNG. Other on-going projects that BPNG leads include the Microfinance Expansion Project supported by the Asian Development Bank, and the Governments of Australia and PNG, in which a financial literacy and education program is to be developed through the newly established National Centre for Excellence in Financial Inclusion (CEFI), the UNCDF-PFIP Financial Diaries and Financial Competency Survey projects(completed), that focuses on understanding the cash-flow management of low income households in selected households in urban and rural communities.

The NFCS survey results will be made available to the public at the conclusion of the workshops in May for raising awareness of the areas that needs to be addressed by the relevant government agencies and for further research.