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REPORTING ON FINANCIAL INSOLVENCY OF HOUSEHOLDS IN THE CROATIAN MEDIA AND THE PROBLEM OF FINANCIAL LITERACY
Abstract
The credit expansion in the household sector, which then stimulated the growth of personal consumption in Croatia, preceded the occurrence of the global financial crisis and the six-year recession that lasted from 2009 to 2014 in Croatia. With regard to enhanced household borrowing in the years before the crisis, there was multiplied effect caused by the inability to settle all the due liabilities in the period after the crisis. In parallel with the legal regulation, which prompted from the beginning of 2011 the Financial Agency (FINA) to begin carrying out forced collection, more intense media interest arose on the subject of households with blocked bank accounts. By using media content analysis methodology, media articles published from 2011 to 2018 were analyzed for information regarding the collection of arrears from individuals whose accounts were blocked. An overview of the research results showed that the problem of blocked accounts also created additional social problems within communities, and an appropriate solution that would improve the standard of Croatian households has still not been found. By contrast, the issue of blocked accounts and media reporting about it has often been used for media promotion of individual political actors by shifting responsibility onto those who currently exercise executive power. However, the solution to the problem should arise from identifying the causes, rather than merely from alleviating the consequences. It is considered that in order to eliminate the future occurrence of blocked accounts, the emphasis should be put on improving the financial literacy of individuals, increasing the level of risk identification and assessment of the individual's creditworthiness, along with implementing a more comprehensive and transparent system of collection. This research emphasizes the importance of deepening financial literacy in order to avoid long-term negative financial consequences for individuals and for society.
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References9
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