RBM worried with unbanked population, to run financial literacy week

The Reserve Bank of Malawi (RBM) is set to observe its maiden financial literacy week between December 9 and 10th at Comesa hall in Blantyre.

According to RBM’s director for microfinance and capital investments supervision Hastings Mzoma, the week has been put in place to provide awareness to people on financial products and services so that they are empowered to make sound decisions in terms of finances.

“Most people in the country lack financial awareness as well as how and where to invest their money and how to manage their finances,” he said.

According to an RBM commissioned FinScope survey in 2008 only 19 percent of the Malawi population is banked.

“Its depressing that only 3 percent of Malawians are aware of insurance and 19 percent is banked. Latest figures show that since government ordered that civil servants should get salaries through the bank the number of the banked has risen sharply to 28 percent,” he added.

Mzoma pointed out that the week’s activities will aim at informing the public on benefits of effective personal finance management, promoting awareness of products and services offered by financial markets and address questions bordering on the financial sector.

“People will witness live trading of shares by the Malawi stock exchange (MSE). We will also inform them on terms and conditions of loans, deposit accounts, Saccos, general insurance, pension and personal finance management,” he said.

RBM’s financial literacy and consumer protection manager, Lanjesi Sinoya, said lack of awareness in financial issues is impacting negatively on the economy of the country.

Said Sinoya, “Lack of financial awareness has led to low saving culture in Malawians. Only 30 percent of money released by RBM is saved in the banks, leaving a whopping 70 percent in people’s pockets. What is all this money doing on the market.”

African countries that conduct financial literacy weeks include South Africa and Ghana.