April is US Financial Literacy Month
Financial Literacy month, if only half of the US population seems to be financially literate, what about South Africa and most African countries in fact. What makes South Africa a unique case is being ranked among the best financial systems in the World yet millions continue being excluded.
Banks and insurance companies are also not getting the real commercial value of improving the financial literacy of their consumers. From bad debt written off, insurance premium default losses to low uptake of saving and investment products; all of this points to a system that’s bound to fail in reaching its fullest potential. A survey conducted by OECD in 2017 concluded that an average South African scores less than 40% on a financial literacy test, making it the lowest among tens of developing countries.
Is it a surprise then, that we have one of the most over-indebted population with the lowest household savings to GDP in the World! We need to invest in policies, innovative tools and data to build high impact and sustainable models designed to alter financial behavior.