Central Bank Concerned By Financial Literacy Rate In The Country

Photo Credit: Central Bank Of Eswatini

By Phesheya Mkhonta

The Central Bank of Eswatini (CBE) Governor, Dr. Phil Mnisi says it is concerning that the majority of adult emaSwati are not financially literate.

The Governor disclosed this during the launch of Global Money Week where he made reference to the Eswatini 2018 FinScope Consumer Survey.

“The Eswatini 2018 FinScope Consumer Survey revealed that only 25% of the adult Swati population have a high financial capability. This is worrying because the data suggests that emaSwati are not as financially literate as they should be. While the Survey did not include children and those below the age of sixteen years (16) we can conclude that financial literacy levels might be much lower for those below this age due to the inherent consequences of our national economy,” he noted.

Mnisi observed that as a result of such findings, it is imperative that the youth is capacitated on money matters to help improve the findings on the FinScope Survey and also empower them economically and financially.

He said the Global Money Week was as a result an important event for the country.

“This is a priority event at the national level, which is why we applaud the Ministry of Finance, Centre for Financial Inclusion (CFI), the CBE and the Financial Services Regulatory Authority (FSRA), the Ministry of Education & Training, and all other stakeholders for ensuring that this week is recognized annually.”

He also revealed that the private sector is collaborating with the government in coming up with a financial literacy strategy that will focus on the youth. Mnisi said it was encouraging that the school curriculum is being reviewed to include financial education from the lowest level until tertiary training.

The Governor further reiterated why it is so important for the CBE to be involved in initiatives that have to do with financial literacy.

“Financial education seamlessly feeds with the CBE’s core mandate, mainly the implementation of monetary policy and the pursuit of financial stability. On the monetary policy front with higher levels of financial literacy, it would be easier for the public to understand the Central Bank’s actions. For instance, how people expect prices to increase in the future influences how they spend, borrow, and invest money today. Key economic concepts of inflation, interest rates, and implications of policy rate changes must be easily understood.”

He concluded by stating that low levels of financial literacy are noted when the interest rate or repo rate is reduced and people take loans that stifle them once the interest rate is increased once again.

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