People know less basic personal finance information than they did before, new GCSE-style tests have shown.
Despite the onset of the credit crunch putting many peoples' spending habits under the microscope, financial literacy has actually declined over the past year.
This was the major finding of a new study from Abbey Banking, which asked a selected group of British adults ten simple "GCSE-style" questions about financial matters. One in seven of this group subsequently failed to gain 40 percent in the test - not even enough for a "C" grade.
Worryingly, when this test was conducted last year barely one in ten failed to get a C. Moreover, the number of people scoring an A grade also fell, from 30 percent to 28 percent.
The study found that 88 percent did not know the amount of time given by providers to pay back credit card debt before it accrues interest (six weeks), while 25 percent were unaware that taking out a secured loan meant that creditors were entitled to take over ownership of the debtor's property if repayments were missed.
Steve Shore, Abbey Banking's director, commented: "While most people are in the realms of a GCSE pass, the failure rate has increased by over one million. Quite worrying given that the credit crunch and cost of living has dominated the front pages for the past 12 months - and people say that they are more interested in understanding their finance than ever before."
