Efforts stepped up to boost financial literacy, inclusion

24 Mar, 2024 - 00:03 0 Views
Efforts stepped up to boost financial literacy, inclusion

The Sunday Mail

Enacy Mapakame

STAKEHOLDERS in the financial services sector have carried out several initiatives to boost financial literacy and inclusion in the country in view of the Global Money Week (GMW) 2024 and beyond.

The GMW ran from March 18 to 24 under the theme “Protect your money, secure your future”, emphasising on driving safe money management and highlighting the importance of adopting a responsible and informed approach to personal finances.

Outside the GMW, the initiatives are also in line with the National Financial Inclusion Strategy II (2022-2026), which seeks to empower Zimbabweans and facilitate financial capability of the underserved through high-quality financial knowledge and skills.

This, in turn, should influence consumer attitude, behaviour towards financial matters and facilitate informed financial decisions.

The 2022 FinScope Micro, Small and Medium Enterprises (MSME) Survey identified low levels of knowledge in four key areas of financial capabilities: managing money, planning, choosing products and using them, and accessing information.

Now, stakeholders and institutions from banking, insurance and capital markets are intensifying outreach programmes to boost financial literacy, especially among rural communities, where about close to 70 percent of the country’s population lives; secondary schools; and tertiary institutions.

In view of the GMW, institutions like Old Mutual, using its financial education programme On the Money, has been conducting workshops with Girls in STEM (Science, Technology, Engineering and Mathematics). The initiative targets girls in high schools and tertiary institutions who are studying STEM subjects.

“During the April Easter holidays, Old Mutual will be hosting online financial literacy bootcamp sessions, which is a programme that targets children in primary and high schools. The bootcamp seeks to instil financial literacy knowledge in children and youths, equipping them with essential skills like planning, saving, budgeting and investing,” said Old Mutual.

Outside the GMW, these initiatives are expected to eventually lead to increased participation in financial services.

In an interview with The Sunday Mail Business last week, Mrs Nyaradzo Nyemba from the Investment Professionals Association of Zimbabwe, which is the local unit of CFA Society South Africa, said they support scholarships and an annual research challenge in universities covering financial services as they prepare students for participation in the sector after graduation.

“We hold several programmes to educate the young, especially women, on investments and financial inclusion. We go out to universities, running outreach programmes explaining the CFA programme, the opportunities available,” she said.

“Our annual CFA Research Challenge is another initiative. We want to provide an opportunity, especially for undergraduates, to interact with people from the industry and mentors so they get an appreciation of the work environment and be equipped with the requisite skills that encourage their inclusion,” she said.

According to the Reserve Bank of Zimbabwe’s annual financial literacy report, financial literacy in Zimbabwe is generally considered to be low, and this has militated against increased usage of financial services by marginalised and underserved groups.

On the capital markets side, where literacy stands at 2 percent, the regulator, the Securities and Exchange Commission of Zimbabwe (SecZim), has been holding programmes to demystify the seemingly complex investment procedures to enhance capacity building for potential investors, particularly women and youths in rural schools.

The commission has also developed a capital markets awareness tool kit that is implemented in school environments. It comprises a book detailing the full history of capital markets to date and everything learners need to know about these markets.

“We have taken the task to summarise the book into more manageable editions and translated into different languages like Shona and Ndebele. We believe the desire to invest in capital markets will grow as a result of greater understanding,” said SecZim director of investor education Mrs Farai Mpofu.

This is in addition to some dramas that track the journey of everyday Zimbabwean entrepreneurs to further demystify capital markets and stimulate interest based on the understanding gained through the programmes.

Financial illiteracy is one of the major barriers to building inclusive financial systems and attainment of some of the United Nations 2030 Sustainable Development Goals.

The FinScope survey further revealed that the low level of financial literacy hinders growth and development of a robust MSME sector. It indicates that only 54 percent of MSMEs keep financial records, which, in turn, brings challenges in terms of accessing formal financial services or policy initiatives that are aimed at the welfare of the sector.

Financial literacy expert Ms Shalom Gowero said financial security enables one to live comfortably on income and save for the future. However, achieving this requires planning.

“Financial planning ensures financial security,” she said at the Financial Markets Indaba (FMI) Women in Financial Markets Conference held last week.

“Financial planning is a necessity if you are to make the most of your money; you ought to develop a fitness plan for your financial health and security,” she said.

ZB Financial Holdings group finance director Mrs Emmah Mungoni emphasised the role of financial independence in an individual’s or business’ lifecycle.

“Finances, money, savings etc are critical in both our personal lives and the business contexts that we operate in. Financial independence promotes prosperity and improves work-life balance,” she said at the same FMI event.

FMI has also been instrumental in driving financial literacy. Its Capital Markets High School Quiz programme, held in partnership with our sister publication Business Weekly, seeks to boost financial literacy at an early stage, which should eventually lead to financial inclusion.

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