The Canadian Bankers Association (CBA) is collaborating with the Financial Consumer Agency of Canada in Ottawa and Toronto-based Prosper Canada to develop a system that will allow financial literacy program providers to measure the effectiveness of their programs.
Terry Campbell, president of the Toronto-based CBA, made the announcement at a panel discussion on financial literacy in Toronto on Wednesday that was organized by the Economic Club of Canada.
“We know there’s a need [for financial literacy] and there’s a lot of effort being made, but do we have the capacity to evaluate the effectiveness of these programs? That’s what we want to put in place,” Campbell said. “Those tools don’t really exist right now.”
The research for this project has just begun and is meant to be publicly available in a little more than a year. It will be accessible to public, private and community-based organizations. Financial advisors will also be able to make use of the resources being developed.
A database of metrics is being developed to provide evidence-based outcomes and indicators of a successful financial literacy program against which other programs could be compared.
The CBA will fund the initiative and Prosper Canada, a non-profit organization that promotes financial literacy, will lead the research and development of this system. The building of this database will involve studying literature on the topic from around the world to identify the factors involved in establishing a successful program.
“The reason we have engaged [with] Prosper is because this is its particular area of expertise and [Prosper] can bring [its] expertise and then develop metrics [for the project],” Campbell said.
Representatives from all three parties will form an advisory committee to review findings and provide feedback.
An online toolkit will also be created to help those who run financial literacy programs tweak those programs in order to improve them, according to Campbell.
“We’re quite excited about this,” he said. “Financial literacy is near and dear to the banking industry. We believe in it very strongly.”
The CBA’s partners also lauded the initiative.
“Financial literacy is a shared responsibility and that’s why it is so critical to be part of this collaborative effort with the CBA and Prosper Canada,” says Jane Rooney, Canada’s financial literacy leader, in a statement. (Rooney has been charged with implementing the federal government’s financial literacy strategy.)
“This project is the next important step in our ongoing work to build a shared menu of rigorous metrics for financial literacy work in Canada,” adds Elizabeth Mulholland, CEO of Prosper Canada, in a statement: “This will make it easier for community financial educators, as well as others, to evaluate their programs.”
The ongoing emphasis on increasing Canadians’ financial literacy has resulted in Prosper Canada engaging in various partnerships with financial servicse institutions. The non-profit announced on Wednesday it is beginning a financial coaching pilot project with Toronto-based Capital One Canada that will examine the efficacy of integrating financial coaching into existing social services.
Prosper Canada also embarked on a separate pilot project earlier this year that connects low-income clients in Toronto to financial advisors that act as financial coaches. A consortium of investment firms is funding this project.