08.03.2021, 16:22 91

Interest-Free Financial Literacy Research

Interest-free financial literacy includes the set of knowledge, attitude, behaviour, and awareness that a conscious actor of the economy should have. In order to better express what we mean by awareness; it is necessary to evaluate interest-free financial literacy from two aspects. First of all, interest-free financial literacy includes the understanding of those with surplus funds to manage their assets without interest in a way that can contribute positively to the sustainability of the economy. Secondly, it includes the equipment and awareness that will enable those with fund deficits to avoid interest in fund procurement. In a sense, interest-free financial literacy is the ability to analyse what is interest, what causes interest economically and to identify interest-free solutions. On the other hand, it includes the ability to develop and regulate interest-free financial solutions. Of course, the ability to distinguish between financial transactions whose economic outcome is the same as an interest that benefits through ambiguity, gambling, health, and rightful share violations should be seen as part of this analytical capability.


Many studies have been carried out so far within the scope of developing interest-free financial literacy, but they are not organised around a common vision and strategy. The systematic structure of conventional financial literacy activities shows that the studies should be consolidated within the framework of a common goal. I think this is the first time that discussions on the organisation of interest-free financial literacy have been brought to the fore here. One of the elements of conventional financial literacy studies is the survey studies conducted with advanced scales. We did not have an effective scale for interest-free financial literacy. The existing scales did not go beyond Arabic terminology studies. Fortunately, after two years of research, we came up with an effective scale. We currently have the only universal survey whose applicability was tested in 15 countries such as Suriname, USA, Djibouti, Austria, Macedonia, Albania, Montenegro, Somalia in Europe, America, Africa continents. In this way, we obtained an argument that can now be followed by customary monitoring in many countries.


This scale was used in our Interest-Free Financial Literacy Research Project, which we presented and reported its results. Moreover, the project was executed with the contributions of the TKBB with the idea of creating a common vision, and the constructive attitude of the Association throughout the process has been very valuable. Thus, the study has become the main reference of the projects to be made in this sense. Developed in cooperation with the TKBB, Turkey’s Interest-Free Financial Literacy Research Project has enabled us to reach very deep and interesting findings. It can be said that the unpredictability of the approach of especially young people and women to participation finance was somewhat eliminated by this study. Because we reached more to those groups in our research. Offering a very pleasant read in addition to this background information, our research has also given us access to qualified data to improve our perspectives.


I would like to state that I find the findings in the research report very striking and quite important to change our view of the main discussions. One of the findings that we need to focus on is that interest opposition can be mistaken for interest rate opposition in Turkey. I would like to say that I prefer to use it as an advantage or leverage rather than see it as a handicap. Another finding that will enrich our area of discussion is that we are more prone to paying interest than receiving interest. It can be argued that the tendency is fuelled by a sense of intimidation or helplessness, but participation finance may change things at this very point. Another finding I would like to bring to the agenda is that takaful can raise the strongest awareness among the participation finance segments. Thus, we can say that other segments of participation finance can use takaful as leverage. Our most important finding is that an effective Islamic financial architecture can find a very wide audience in Turkey (92%). I would like to state that we should place the emphasis on this finding on the concept of “effectiveness”. Accordingly, participation finance has the potential to appeal not to a small group but to unrestricted market shares. The data in this sense show that our need for visionary approaches has increased.

Finally, I would like to say that the special policy proposal of the research will come to life as we agreed in the meeting that we held with TKBB administrators. So, we will be able to see that the operations under the title of interest-free financial literacy are followed and coordinated, thus being organised with a common purpose. The interest-free financial depth and volume to be created by the synergy of these works will open important areas for Turkey. We will continue to contribute both to Turkey and to the world.

Lecturer at Faculty of Islamic Economics and Finance at Istanbul Sabahattin Zaim University - Director of Management, Entrepreneurship and Leadership Application and Research Centre Assoc. Prof. Yusuf Dinç

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