Enhancing Financial Literacy for Young Entrepreneurs in Bosnia: Insights and Challenges

1. Business and Financial Literacy for Young Entrepreneurs:Evidence from Bosnia-Herzogovinaby Miriam Bruhn and Bilal Zia Discussant Comments Margaret Miller

2. Provides a strong environment for financial literacy intervention – best case scenario • Looks at a complete training program offered by a qualified instructor (good case) – NGO Entrepreneurship Development Center, faculty from Univ. of Tuzla, used interviews to adapt curriculum to needs of target population • High teacher – student ratio 1 to 6 or 1 to 10 • Monetary incentive – US$3 5 for participating, free transportation • Business loan clients in good standing (according to Partner’s definition) • Businesses with profits that are higher than GDP per capita, 5 years old, have one or more employees

3. Provides a strong environment for financial literacy intervention – best case scenario Motivated students • Highly motivated – small group of 117 that actually took the training , 39% of sample that had indicated interest in training • People who had been late on at least one payment were more interested • Women were less interested Would like to have seen the paper address this potential selection bias more directly

4. Differential impacts by baseline financial literacy level • People with below average levels of financial literacy had greater increases in knowledge measured on the survey • People with above average levels of financial literacy to report higher profits, greater sales • People in treatment group 22% less likely to mix personal and business accounts – regardless of financial literacy level

5. Questions going forward • What resulted in the higher profits and sales? • Is this a cost effective approach? • How do you reach the populations that have less motivation, interest • Low levels of financial literacy • Women