Factors shaping the financial capability of low-income consumers from rural regions of Poland

The two-fold purpose of this study was to explore the financial capability of low-income consumers from rural regions of Poland, using Xiao's financial capability index, while accounting for their poverty status, demographic and financial characteristics. To test the relevant hypothesis of the study, a micro database of low-income consumers was used. Factor, descriptive and correlation analyses were employed for preliminary examinations. One-way ANOVA was used to examine the impact of different poverty indicators on financial capability index variables. Multiple OLS regressions were used to examine the influence of the selected factors on the level of financial capability. Six sets of linear regression models were used to explore the effects of factors associated with the financial capability variables. The findings of our study suggest that financial inclusion is an essential component of the financial capability index. The results also show that all five variables play a significant role in the financial capability index. Therefore, Xiao's financial capability index captures a specific combination of financial literacy and financial behaviour of low-income consumers from rural regions of Poland.