Credit Access and Financial Literacy: A New Standard?
Will Financial Literacy Be Mandatory to Obtain Credit?
Credit has become inseparable from modern life. People use loans to buy homes, pay for education, launch businesses, or manage emergencies. Companies rely on credit to finance operations and expansion. Yet despite its importance, borrowing often takes place without a full understanding of what it really means. Interest rates, compounding costs, hidden fees, and repayment schedules remain mysteries for many borrowers. This lack of understanding contributes to rising default rates, financial distress, and fragile credit systems. Against this backdrop, regulators and banks are asking a provocative question: should financial literacy be mandatory to obtain credit? The idea challenges long-standing assumptions about access to lending and forces us to think about whether knowledge should be a gatekeeper to borrowing.
