Factor Analysis of Increasing Deposit Insurance Literacy through Education in Indonesia

Abstract

This study aims to look at the factors that can affect the literacy of deposit insurance, especially to encourage the creation of better deposit insurance literacy in the community facing uncertainty in the current world economy and finance. This research was carried out using multiple linear regression analysis methods. Data collection was carried out through the distribution of questionnaires via Google Forms. Respondents used were 270 people with the determination respondents using a purposive sampling method with the criteria of respondents living in Jakarta, at least 18 years old, having graduated from high school, and already have an income. The results of this study indicate that financial literacy, financial inclusion, socio-demography in the form of formal education, income, risk tolerance, and education in the financial sector significantly influence deposit insurance literacy. Furthermore, on the aspect of social institutions, it was found that formal institutions and cognitive culture significantly influenced deposit insurance literacy, while informal institutions did not affect deposit insurance literacy. Furthermore, it was also found that financial inclusion, formal institutions, and community income are the most substantial factors driving deposit insurance literacy in the community. The results of this study provide several recommendations especially for Indonesia Deposit Insurance Corporation (IDIC), including that IDIC needs to improve education related to deposit insurance literacy itself, primarily through financial institutions that deal directly with customers, and establish closer relationships with the government, schools, and universities to be able to encourage greater deposit insurance literacy high in society.