Improved financial literacy still needed among Filipinos
There is need to improve financial literacy among Filipinos, as many still lack the knowledge to make informed financial decisions, according to executives of Home Credit Philippines.
Home Credit Philippines said in its 2022 ESG Country Card that “a large portion of the population lacks the knowledge and skills to effectively manage their finances, make informed financial decisions, and avoid financial risks.”
In 2022, Bangko Sentral ng Pilipinas cited a global financial literacy study by Standard & Poor’s (S&P Global Ratings) and revealed that the Philippines ranked in the bottom 30 of 144 countries, with only 25% of Filipino adults considered financially literate.
Additionally, in the 2021 Financial Inclusion Survey, only two percent of Filipinos correctly answered all six basic financial literacy questions, while 69% correctly answered at least half.
At a press event on May 13, Home Credit Philippines Executive Director and Treasurer Zdenek Jankovsky said that their sales agents are their main ambassadors for financial literacy because they are the ones who directly communicate with customers.
“Seeing the communication and understanding of the how to let this go along comes from our sales agents that we have really thanked. It is really important for the customers to understand what it means to have a loan,” he said.
Pushing for financial literacy
At present, there are bills filed at the Senate and House of Representatives seeking to include financial literacy subjects in schools.
“Habang patuloy na lumalaki ang kontribusyon ng financial activities sa paglago ng ating ekonomiya, mahalagang tiyakin din nating may sapat na kaalaman ang ating mga kababayan pagdating sa mga usaping ito,” (While the contribution of financial activities on our economy continue to grow, it is important as well that the citizens have enough knowledge about financial literacy,) Senator Sherwin T. Gatchalian proclaimed last February 1, as he further pushed the passage of Senate Bill 479 or the Economics and Financial Literacy Curriculum and Training Act.
Under the bill mentioned, Mr. Gatchalian aims to improve the financial literacy of the citizens through teaching Economics and Personal Finance (EPF) courses from elementary to tertiary level.
Cagayan de Oro City Rep. Lordan G. Suan also filed House Bill (HB) No. 9162, or the Financial Literacy Education Bill, that proposes to include financial literacy in the senior high school curriculum.
Some of the topics include the basics of personal finance, including budgeting, saving, investing, credit and debit, insurance, taxes, and how to apply them in real-life situations,
Home Credit Philippines Chief Marketing Officer Shiela Paul said they took it upon themselves to advocate financial literacy and educate their customers.
“We make sure that we walk them through, even at the point of sale, how to understand their installment, how to understand your contract, when is your payment due date… We try to make it very educational,” Ms. Paul said.
Home Credit Philippines Chief Executive Officer David Minol
In line with this, Home Credit Philippines Chief Executive Officer David Minol asserted that their “Wais Sa Home” program helped Filipinos “achieve financial stability and protection from fraud.”
“Many of Home Credit’s customers are first-time lenders. This is why we’re equally committed to empowering Filipinos to make ‘wais’ financial decisions,” Mr. Minol said. – Almira Louise S. Martinez