The Impact of Socio-Cultural Norms on Sustainable Financial Literacy in Pakistan

Abstract

The focus of this research is the influence of financial literacy, social factors, and sustainability of appropriate financial behaviours in Pakistan. Specifically, understanding that there are many ethical and sustainable investment opportunities, the research shows cultural and societal limitations that prevent people with very low financial literacy, 24% in the whole of the UK, from practicing financially sustainable behavior. Working under the umbrella of a quantitative research study, the authors gathered all the data by using a set of questionnaires based on key variable like financial literacy, cultural perception, and acting sustainably financially. This study has revealed that despite financial literacy helping people make informed decisions, social culture especially family and community practices influence financial decisions. Small correlation was achieved when testing the relationship between financial literacy and improved sustainability, an implication that culture is a more significant factor in decision-making than knowledge. Moreover, awareness of sustainable financial tools is present but the utilization is low because institutions do not support and prioritize sustainable financial choices, and people prioritize their pressing financial concerns. The study concludes with actionable recommendations: improving content and delivery of financial literacy in terms of sustainability, developing appropriate investment solutions with regard to sustainable investing, and therefore, changing consumer behavior and creating the link between knowledge and action. Some implications discussed particularly concern policy, indicating that there is a requirement for the government to set up incentive and institutional mechanisms. Hence, the above stated paper provides valuable insights about enhancing the way of earning sustainable financial literacy in the Pakistan society.