**4. Descriptive Statistics**<sup>4</sup>

Table 1 presents the average values of the scores of financial literacy and financial inclusion in Cambodia and Viet Nam, including breakdowns by various categories. In both countries, the level of financial literacy is rather low, with that of Cambodia being the lower of the two. The financial literacy scores are only 11.8 and 12.5 in Cambodia and Viet Nam, respectively, out of a total possible score of 21. These scores are much lower than the 30-country average score of 13.3 and those of some other developing Asian economies such as Thailand (12.8) and Malaysia (12.3) (OECD/INFE 2016).

Of greater concern, perhaps, is the fact that the share of respondents who answered correctly five out of seven financial knowledge questions, which is considered to be the minimum target level, was very low. Based on our samples, only 17.0% of people in Cambodia and 36% of people in Viet Nam answered correctly five or more questions. On average, this figure is 62% for the OECD countries surveyed, and 56% for the full sample of 30 countries surveyed (OECD/INFE 2016). Again, however, this gap can be attributed to the low level of income in these two countries.

These average financial literacy scores are quite consistent with individuals' self-assessment of overall knowledge about financial matters compared with other adults in each country (Figure 1). Only about 12–14% of Cambodian and Vietnamese respondents considered themselves to have a better understanding of overall knowledge about financial matters than other adults. This is consistent with the results for other countries with relatively low financial literacy scores. About 63% in Cambodia and 59% in Viet Nam self-assessed that they have the same level as other adults.

<sup>3</sup> The score for savings behavior in this section is identified through questions on whether the respondents hold any types of saving accounts or participate in saving clubs or not (the so-called "formal way to save"). Savings, however, could take many other forms, such as holding cash at home, or in a wallet, building up a balance in a bank account, giving money to a family member to save, buying gold, property, or livestock, etc. We also present the estimation results using a broader definition of savings (i.e., it takes the value of one if an individual either saves in formal ways or informal ways, and zero otherwise) in Appendix D.

<sup>4</sup> In this section and the empirical results section, we use a weighted sample. In Viet Nam, weights are calculated based on the rural-urban population distribution and economic conditions (measured by income per capita) to correct for the underrepresentation of the top 40% income groups and slight underrepresentation of the urban population in our sample (especially in the South East region). In Cambodia, weights are calculated based on economic conditions (measured by income per capita). Please refer to Appendix B for details.


**Table 1.** Financial literacy and financial inclusion scores in Cambodia and Viet Nam.

*J. Risk Financial Manag.* **2019**, *12*, 19

**Figure 1.** Self-assessment of overall knowledge about financial matters in Cambodia and Viet Nam. Note: A weighted sample is used to draw this figure. Source: Authors' compilation from survey data.

Financial literacy varies by population group in both Cambodia and Viet Nam (Table 1). In both countries, younger, urban, more educated, and higher-income respondents have higher financial literacy scores. While female Cambodians have slightly lower financial literacy scores than male Cambodians (11.74 vs. 11.85), female Vietnamese have higher financial literacy scores than their male counterparts (12.80 vs. 12.50).

For all subcomponents of the financial literacy score, younger, more educated and higher income groups of population have higher scores than older, less educated and poorer ones in both Cambodia and Viet Nam. Cambodian women have higher financial knowledge and financial attitude scores, and lower financial behavior score than their male counterparts, but in Viet Nam, women have lower financial knowledge scores and higher financial behavior, and financial attitude scores than men. Similarly, the differences in financial literacy score between Cambodian rural and urban residents are mostly due to differences in financial behavior and financial attitude score while differences in scores of all three sub-components between rural and urban residents add up to the rather large gaps in urban and rural financial literacy scores in Viet Nam.

Figure 2 documents the saving behavior of Cambodian and Vietnamese in our sample. The proportion of respondents who do not have saving products is rather low in both Cambodia (16.0%) and Viet Nam (25.7%). The saving forms that most of respondents in our sample use are informal (such as keeping money at home, asking friends, relatives, or other family members to keep money for them). More than 80% of Cambodian and 64% of Vietnamese use this form of saving. The proportion of respondents who save in formal financial institutions or buy saving products (i.e., formal saving forms) is rather low, however. A relatively small share of respondents (10.1% in Cambodia and 16.2% in Viet Nam) have both formal and informal savings.

**Figure 2.** Proportion of individuals using different saving forms. Note: A weighted sample is used to draw this figure (see Appendix B). Source: Authors' compilation from survey data.

Table 2 presents the descriptive statistics of explanatory variables included in the econometric models (both unweighted and weighted samples). The average monthly household income is USD 310.0 in Cambodia and USD 420 in Viet Nam.<sup>5</sup> In the Cambodian sample, 53% have only some primary education, 43% have some secondary education, while only 4.1% have some tertiary education. Although more than a quarter of the Vietnamese sample have some tertiary education, which is much higher than the Cambodian sample, the group with some secondary education accounts for the largest proportion, at 41%. The age distribution is also slightly different. While people aged over 60 account for more than 11% of the Cambodian sample, they make up only about 3% of the Vietnamese sample. With regards to occupation, while 52% of the Cambodian sample are self-employed, this figure is only 22% in the Viet Nam sample. Salaried employees account for one-third of the Vietnamese sample, which is much higher than the Cambodian figure (16%). About 70% of Cambodian respondents live in rural areas while this figure is about 61% in Viet Nam. Due to the rather large differences in the Cambodian and Vietnamese samples, in this paper, we estimate the determinants of financial literacy and the impacts of financial literacy on financial inclusion and the savings decision separately for each country. However, we also provide results for the pooled sample in Appendix D.


**Table 2.** Descriptive statistics of explanatory variables.

Note: Share of total respondents except where noted. Source: Authors.

<sup>5</sup> In this paper, we use household income as the independent variable since it is expected to be more related to household financial matters than individual income.
