No.10 Financial Literacy and Remittances: The Case of Mongolian Migrants in Japan

This paper examines determinants of financial literacy and its effect on remittances among a rarely studied group – Mongolian migrants in Japan, a small but actively remitting population who have special financial needs related to remittances. Using primary surveys targeting both Mongolian migrants in Japan and their families staying in Mongolia, financial literacy of migrants are measured by a combination of three competencies: financial knowledge, financial behavior, and financial attitudes. Financial literacy of Mongolian migrants in Japan is primarily influenced by factors such as income, proficiency in the Japanese language, and educational attainment. Interestingly, while overall financial literacy does not seem to affect the decision to send remittances or the amount sent, individuals with stronger financial attitudes are less inclined to send remittances. This finding suggests that remittances are frequently utilized for immediate consumption rather than being allocated towards long-term financial goals.

Keywords: financial literacy, migrants, remittances