Growth strategy for the financial sector

Growth companies play a major role in economic growth, and equity investments plays a major role in financing growth companies. This is why the working group decided to focus on the functioning of Finland’s equity investment market. Finland has a bank-centric financial system, which was another reason for the working group’s choice of focus. A more diverse system would be both more stable and more supportive of growth.

The ways that households save play a role in the development of the capital markets. Though Finns have begun investing more in shares for example, a large share of financial assets remain in deposits. Encouraging households to diversify the investment instruments they use would provide depth to the Finnish capital markets.

Financial literacy of households improves their ability to use a variety investment instruments. The average financial literacy of the Finnish adult population is in line with the OECD average. Financial literacy among Finnish youths, however, is among the best in the world. However, there are major differences in financial literacy between Finnish youths.

The working group’s long-term objective is to diversify Finland’s bank-centric financial system and boost the level of ambition with respect to growth financing and financial literacy. Achieving this objective will require action to promote the scaling of risk financing, improve the position of retail investors and make use of the EU single market.