Financial Education Proposal - DOC by tzd18113


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                   Evaluation of Financial Education Programs
                      in Low and Middle-income Countries

                                       CALL FOR PROPOSALS
1.      Background
The Russia Financial Literacy and Education Trust Fund was established in October 2008 with a
commitment of $15 million over four years from the Ministry of Finance of the Russian Federation to
support the advancement of financial literacy and capability programs in low and middle income
countries. This is to be undertaken through the development of methods and best practices for the
assessment of financial capability and evaluation of outcomes and impacts achieved by financial
education programs.

The increased role and complexity of financial markets and their products in countries at all development
stages has reinforced the need to improve the capacity of consumers to effectively access and manage
interactions with these services, especially in low and middle income countries where financial inclusion
is poor and educational attainments are low. To enable consumers in these countries to understand,
access, and make better financial decisions regarding bank accounts, credit, savings, insurance,
retirements, and an array of other more complex products, development of programs aimed at improving
knowledge, skills, attitude and behavior in this area are required.

Despite the nearly universal nature of the need, however, there is not yet a consensus about how to best
define the knowledge and skills required for financial capability, how to measure capability levels among
different groups, and how to evaluate the effectiveness of programs designed to enhance from knowledge
to behavior change. Against this background, the Trust Fund’s main focus will be the development of a
conceptual framework and an operational toolkit on methods for (1) measuring levels of financial
capability, and (2) evaluating the impact of financial education programs on raising the skills and
financial capacity of target groups and inducing positive changes in behavior.

2.      Evaluation of Financial Education Programs
Financial education programs across the world are characterized by two critical facts: First, while there is
some evidence that financial education can enhance financial knowledge, there is limited empirical
evidence that financial education has an impact on behavior and outcomes, and on the ultimate goal of
improving financial well-being. Second, while there is a widespread agreement that developing countries
have especially low levels of financial literacy, and the recently enhanced policy attention has increased
funds channeled towards financial literacy programs, little evidence exists on the impact of these
interventions. In cases where evaluation is done, it does not often use rigorous methods and does not
provide evidence with sufficient external validity to convince researchers and policymakers regarding
attribution or causality.

This general lack of rigorous evaluation in financial education is likely rooted in multiple causes: 1) There
is not yet a clear results framework for financial education – what should be achieved and how the final
and intermediate outcomes, outputs and impacts are best defined and measured; 2) There is little
understanding and appreciation among the providers of financial education of the value of evaluation; 3)
There is no readily available toolkit on evaluation to guide providers of financial education; 4) Capacity
in low and middle income countries to undertake even basic evaluation is extremely limited; 5)
Resistance among sponsors of financial education programs to devote a meaningful share of resources on
evaluation is common.

3.      Objectives of the Trust Fund
The overall aim of the Trust Fund is to support the advancement of financial literacy and capability in low
and middle-income countries by developing and testing standard methods for measuring levels of
financial capability and evaluating the impact of financial education programs. The knowledge derived
from these efforts will be used to inform policy makers and other interested parties about the impact of
financial capability on behavior and overall financial well-being of individuals, the effectiveness of
financial education programs in enhancing levels of financial capability, and most importantly, to
improve the capacity of countries to develop effective financial education strategies over the longer term.

4.      Support for an Initial Round of Country-Specific Projects
A main part of the Trust Fund activities will be devoted to developing a common results framework that
is linked to a Toolkit and Guidelines that can be used to assess the impact of financial education programs
in low and middle income environments. A solicitation will be issued shortly to engage consultants to
review the relevant literature and experience to date in evaluating these types of programs and to develop
an initial draft of the Toolkit and Guidelines. To supplement the available experience and ensure that the
process of the toolkit development is informed through observation and interaction with current programs
engaged in developing impact evaluation methods, financial support will be provided to a limited set of
relevant programs during the period in which the initial draft of the toolkit is being produced. This is
intended to enable the consultants and the Bank Staff overseeing the process to benefit and learn from real
world experience throughout this process as well as to provide timely support for programs that are
related to the overall objectives of the Trust Fund.

Toward this end the Trust Fund team is seeking to identify and provide an initial round of grants to
programs that fit within the priority areas around which this work will be organized that would benefit
from a grant from the Trust Fund to support their evaluation activities. Following this initial round of
grants a more extensive round of funding will be provided through a separate funding window that is
expected to be opened in early 2011 that will provide funding for the testing of the methods set out in the
initial draft of the toolkit. In return for the financial support, recipients in this first round of funding will
be expected to engage in consultation and information sharing with the Trust Fund Management Team
and consultants engaged to develop the toolkit. In addition to the financial support, grant recipients
should benefit from this engagement through their interactions with a variety of experts in this field that
will be developing the toolkit and providing expert advice to the Trust Fund Management Team during
this process.

Grants will be provided on the basis of applications received through Bank Staff who will serve as the
Task Team Leader for the engagement with the individual programs. Proposals may be submitted for
projects that may be either solely country initiated and financed or for programs that are supported
through other Bank operations. Proposals may be submitted for Bank executed grants or for work that
may be either fully or partially recipient executed.

The maximum funding that will be provided for an individual grant in this initial round will be US$
300.000, with the expectation that this will be used to cover the cost of developing and implementing the
evaluation program and interactions with the team that is developing the toolkit. However, in special
circumstances, depending on the nature and scope of the project, after the cost of evaluation is covered,
consideration will be given to proposals that would use some of the funds to support the intervention that
is to be evaluated, provided that the overall funding remains below this overall limitation. The Trust Fund
is permitted to cover the costs of Bank Staff engaged in preparation, oversight and conduct of the
undertaken by the Trust Fund so these may be included in the proposal.

5.      Eligibility & Selection Criteria
Country Eligibility
The Trust Fund will finance projects in low-income (IDA) and middle-income (IBRD) countries only.
The Trust Fund aims to achieve country diversification in selected proposals and if feasible will select
approximately 50 percent of the proposals from low-income countries.

Areas of Focus
The development of evaluation methods will focus on a defined set of topics and delivery mechanisms.
Although all proposals for funding that are related to useful and innovative financial capability
enhancement programs will be considered, priority will be given to those that address one of the topics
through one of the delivery mechanisms outlined below:

 Day-to-day financial management (personal finance)
 Planning for the long-term (budgeting, savings, investments, retirement, education planning)
 Planning for the unexpected (budgeting, savings, insurance)

Target groups:
 Low-income consumers in low and middle income countries: school children, people working in the
   informal economy, farm households, micro-enterprise owners, recipients of government-to-people
   transfers. This might also include low-income people affected by life events (birth of a new child,
   death in family, health related problems), etc.

Delivery mechanisms:
 Formal financial education (one-to-one and classroom based): targeting school children, people
    working in informal economy, or generally low-income consumers.
 Social marketing/edutainment: targeting people working in informal economy, generally low-income
    consumers, including opportunities created by significant life events, such as birth of a new child,
    death in family, health related problems, etc.

   Financial education for micro-enterprise: targeting people working in informal economy, farm
    households, or other subgroups representing low-income population (note: the Trust Fund is not
    interested in studying the financial literacy related to formal-sector business management. Rather, its
    focus is on basic skills and financial services relevant to the poor in helping them with micro-
    enterprise activities, such as basic budgeting and knowledge and skills about banking services
    [checking and savings accounts], credit, interest rates, etc).
   Opportunities provided by government-to-people transfers:
             o Conditional cash transfers (CCTs)
             o Matching defined contributions (MDC) savings arrangements, and
             o Other government-to-people transfers

Scope of Programs
In order to ensure generalisability of findings from the funded pilots, all projects are expected to:
   i.   measure the effect of financial education programs on knowledge enhancement;
  ii.   measure the effect of financial education programs on changing behavior; and
 iii.   measure the extent to which the change in behavior improves decision making and enhances the
        financial well-being of consumers.

Strong preference will be given to projects that seek to measure all three of these components, however,
proposals looking at only the second or third component will be considered. It is important to note that
proposals are discouraged from focusing only on the impact of financial education on knowledge
enhancement as much research has already been done on this particular aspect and a positive correlation
has been found. Whereas a link between knowledge enhancement and behavioral change as well as its
impact on the overall financial well-being is still unclear and is the focus of the Trust Fund’s program.
Proposals that aim to evaluate long-term impacts are encouraged to leverage co-financing from other
sources as the timeframe for implementation might go beyond that of the Trust Fund.

Results Framework
Each project proposal considered for selection and financing needs to plan for a comprehensive results
framework, with clearly defined objectives of the intervention and fully developed results chain from the
proposed delivery mechanism to the expected outputs, outcomes and impact, with proposed indicators.

Evaluation Methods
The purpose of the evaluation is to make an assessment of both the delivery mechanisms as well as of the
objectives, outcomes and impacts of financial education programs. Therefore, a combination of process
evaluation and impact evaluation is preferred, including qualitative research methods (in-depth
interviews, focus groups, or observation techniques) and quantitative experimental studies.

The study must determine both causality and attribution. It must be able to show to the most rigorous
extent possible that the observed outcomes were caused by the intervention being evaluated, and it must
be able to control for or otherwise dismiss other possible explanations for the observed outcomes. In
addition, the study must strive for external validity. The evaluation must be able to control for
unobserved factors that might determine heterogeneity in outcomes. These criteria are conventionally
satisfied by the use of experiments with random assignment of treatment and control or comparison
groups, but other methods for identifying a counterfactual will be welcomed, especially in the cases

where treatment is not easily excludable. In addition, proposals are welcome to test one (or more)
method(s) with alternative audience/recipient groups and/or alternative methods of delivery, and examine
dose-response effects. The Trust Fund is also interested to study how much financial education is
optimal, and whether differences in pedagogy or content matter.

The proposal must clearly describe the identification strategy to be used. In addition the proposal must
include information on the population and sample to be studied, including size and power calculations,
expected effect sizes, and how the study will deal with departures from probability sampling and issues
such as non-random attrition.

Other Eligibility Criteria
In addition, the Trust Fund requires that all projects:
     Are administered through a Trust Fund Accredited World Bank Task Team Leader designated
         within the appropriate country office or region sector. In cases when assistance is needed, the
         Trust Fund team can advise in indentifying a Task Team Leader.
     Participate in all meetings and workshops organized by the Trust Fund team.
     Provide multiple rounds of feedback from fieldwork to the Trust Fund advisory team.

6.      Application Process
Since the projects are intended to inform the development of the Toolkit, the Trust Fund will give
preference to programs that are ready to start implementation as early as September of 2010.

Applications should be submitted to Florentina Mulaj ( through a World Bank
Task Team Leader between April 13, 2010 and May 31st, 2010. Proposals will be reviewed on a rolling
basis and decisions will be made accordingly. Therefore, interested parties are encouraged to apply as
soon as possible once the window has opened.

The Task Team Leader must submit the completed application form attached (Annex 1) and provide a
proposal that describes the background and policy relevance of the project, planned activities, timeframe,
the proposed budget, institutions/organizations involved in financing or implementing the project,
preferred execution framework (Bank executed or Recipient executed) and justification for such
preference. The proposal should not exceed 15 pages and should address all of the technical questions
included in the template attached (Annex 2). Additional supporting materials can be submitted as

A meeting or videoconference with potential Task Team Leaders may be scheduled around April 19,
2010 for discussions and clarifications about the application process and about selection of the
appropriate execution framework.

7.      Selection Process

The window for submission of proposals will be open from April 13 to May 31st 2010. Decisions will be
made on a rolling basis and might potentially involve an interaction with the applicants for the refinement
of the proposals. The Trust Fund management team will make decisions based on judgments regarding

proposals that will be accepted in consultation with a group of expert consultants. Proposals will be
judged on the basis of adherence to the criteria outlined above in consideration of the value of the
proposed evaluation effort to inform the development of methods, the innovative nature of the approach
proposed and the likelihood of timely information and results to be obtained from the effort.

8.      Deliverables

The detailed list of the deliverables will be distributed after proposals have been selected. Tentatively, it is
likely to include:
     Participation in meetings organized by the Trust Fund management team.
     Detailed implementation updates. These might be in the form of mid-term reports.
     Full project completion report including a description of the program’s overall methodology
         (including interventions), main results and the main issues encountered during the process.

9.      Resource Availability

Resources will be made available to the Task Team Leader upon selection of the project. Following
selection, Bank Task Team Leaders will be expected to submit a Grant Funding Request (GFR) to fund
the grant supported activities.

For information please contact:

Florentina Mulaj (HDNSP), or +1 (202) 458-8043

                                                                                   ANNEX 1

            TRUST FUND (FLIT)
                           Impact Evaluation Window
                                   Application Form
General Information
Task Team Leader:                                               World Bank Unit:
Task Team Leader contact information:
Proposal Name:
Grant Recipient:
Grant Recipient contact information:
Proposed framework:                 Recipient executed          Bank executed
Is the project related to existing World Bank lending operations?          Yes     No
       If Yes, which ones?
Is the project related to existing World Bank non-lending operations?       Yes    No
       If Yes, which ones?
Budget Information
Proposed grant amount (USD):
Share of total cost of the project to be financed by the Trust Fund:
Co-financing institutions (if applicable):
Implementing agencies/firms/organizations:
Other involved agencies/firms/organizations:
Proposed implementation start date:
Proposed completion date:

                                                                                            ANNEX 2

           TRUST FUND (FLIT)
                         Impact Evaluation Window
                                 Proposal Template
Please provide in a format of your choice a project proposal addressing the following key questions:

                           SECTION A: Background and Objectives

 1. Description of your proposal including the background and rationale, key objectives, and a
    brief description of the pre-existing or planned project to which it is linked and expects to
 2. Description of national strategy on financial capability, policy relevance of the proposed project
    and potential support by institutions at the national level.
 3. Description of planned key activities to achieve objectives or expected outcome.
 4. Description of the outputs or deliverables of this proposal.

                                   SECTION B: Methodology

 5. Identify the areas of focus (a. financial literacy topic; b. delivery mechanism; c. target group).
 6. Describe the approach and methodology.
 7. Does the project aim to assess the impact of financial literacy on: a) behavioral change and/or b)
     overall financial well-being of individuals? Please describe the specific objectives that the
     project aims to achieve.
 8. Describe the results framework. How does your intervention lead to the intended outcomes?
 9. How will you measure and report on the success of your project? How will you assess whether
     the proposal objectives have been met? What are the measurable indicators that describe these
 10. Does the proposal include a plan to monitor results and track progress towards achieving project
     objectives? Please describe.
 11. Does the proposal include an evaluation plan? What is the plan for data collection and data
 12. Does your proposed evaluation method include an explicit control group? If not, how do you
     propose to identify causality and attribution?
 13. Describe the sample frame, sample size, expected effect size, and expected power.

                                  SECTION C: Implementation

 14. Describe the implementation and execution structure.

                                        SECTION D: Timeline

  15. Describe your timeline
  16. What is the proposed Financial Education Program/Intervention start date?
  17. What is the proposed Financial Education Program/Intervention completion date?
  18. What is the proposed evaluation implementation start date?
  19. What is the proposed evaluation completion date?
  20. For how long after the completion of intervention will the team monitor results (expected
      behavioral changes of the individuals and/or overall financial well-being of individuals)?
  21. What is the proposed date for submission of the first status and/or mid-term report?
  22. What is the approximate date by which to expect results on the short and/or long term impacts?

                                         SECTION E: Budget

                  Total amount of funding request: $_________ (maximum $300.000)

Category                                                                          Amount ($)
Total project budget
Co-financing amount (if applicable)
Portion of project cost that the Financial Literacy Trust Fund grant represents
How much of the Financial Literacy Trust Fund grant resources will be
dedicated to evaluation activities?
How much of the Financial Literacy Trust Fund grant resources will be
dedicated for Intervention costs? (If applicable. Note that not all proposals
will be eligible to use Trust Fund grant resources for intervention costs)

Trust Fund Grant Expenditures                                                     Amount ($)
Staff Salary & Benefit Cost
Consultant fees
Workshops, publication and dissemination
Other expenses (explain below)

Explanation of other expenses:


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