BUILDING a financially inclusive ecosystem on a sustainable basis requires the involvement of a key constituency in the economy — the children and youth.
One cannot talk of financial inclusiveness without addressing the challenge of involving the young in the discussion and practice of financial inclusion.
Children and youth are both current and future social and economic actors, whose decisions will influence development of their societies.
The recent global financial crises, in various ways highlighted the importance of promoting social responsibility and developing skills in financial management for all persons, across all countries.
This is especially true for children and youth, who are particularly vulnerable. Important values of citizenship and skills in managing financial resources at an early age can lessen social and financial vulnerability; thereby reducing the risk of poverty caused by both lack and debt burdens later in life.
This discussion is as important for any country as it is for Zimbabwe, which is why key stakeholders in the economy such as banks in Zimbabwe, are not only opening and encouraging discourse on the matter, but exploring tangible ways of making financial inclusion a long-term reality in the country and the region.
It is, however, important to note that there is a vast body of knowledge and experience that has already been built by organisations such as Unicef and the child, youth and finance international, that have helped devise workable models for rolling out financial inclusion programmes in environments such as ours.
As such, there is no need for financial inclusion practitioners to reinvent the wheel, but to seek to remodel the tools already developed to suit the local conditions and economic circumstances.
The starting point of discourse is naturally agreeing on the globally-acceptable definitions of social and financial education.
What is child social and financial education?
Child social and financial education (CSFE) describes the efforts and methodologies that are aimed at inspiring children to be socially and economically empowered citizens by equipping them with the skills and knowledge to become active agents capable of transforming their communities and societies.
The CSFE principles provide children with a holistic learning experience that embraces knowledge and skills harnessed from both inside and outside the classroom.
The CSFE approach is in accord with the Committee on the Rights of the Child General Comment NO 1 on article 29 of the Convention of the Rights of the Child (CRC), which states that: “education goes far beyond formal schooling to embrace the broad range of life experiences and learning processes which enable children, individually and collectively, to develop their personalities, talents and abilities and to live a full and satisfying life within society”.
The three CSFE components comprises life skills, financial literacy and livelihoods education.
Together, the components aim to build life skills, change financial behaviours, stimulate business activity and increase financial literacy and capability.
Alongside literacy and numeracy, life skills are essential learning outcomes of quality education.
These aspects as already alluded to in our prior article, are often referred to as defining the economic citizenship of an individual.
What is the correct age to teach financial concepts?
While there is some reluctance to exposing children to financial concepts at too early an age, there are considerable benefits to introducing financial education while young people are still in a process of formulating personal financial behaviours.
Research has shown that there is a direct relationship between the age of learners and behavioural changes.
In light of this, financial education that is introduced early in life is more likely to be retained, which therefore increases financial knowledge and literacy later in life.
These behaviours such as respect for financial contracts, saving and managing financial resources, productivity and enterprise always prove invaluable in life for the individuals and society at large.
A good financial education package therefore addresses the learning needs of children along their entire social development continuum from infancy, through adolescence and young adulthood.
Experiential learning and the practical dimension
Exposing and connecting children to financial service providers at an early age allows them to recognise the role that such institutions play in society.
By applying the lessons learned through financial education in the classroom in real life situations, children can take greater control over the development of their financial capability.
Linking youth with financial services providers should include both financial and complementary “non-financial services”, such as mentoring, which ensures that young people are able to “better navigate the challenges involved with learning to save, managing their own money, starting a business and managing the risks that might prevent them from achieving their goals”.
The role of the education system
The learning environment in schools lends itself well in growing children in developing their basic skills.
However, such learning should be re-inforced with practical activities such as the formation of savings clubs where children participate and get the hands on feel of the theoretical training.
For example, a project in Kenya found that the introduction of child savings accounts improved the wellbeing of children and youth living in poverty.
This preliminary research study on out-of-school adolescent Kenyan girls who participated in financial education determined that girls in the experimental group more than doubled their initial savings after being trained in important life skills including saving, business support and mentoring skills.
In Zimbabwe, one of our member banks is also involved with Unicef, in promoting the child-friendly budget initiatives with junior parliamentarians.
Various other banks in the country are offering child-friendly and youth banking products.
Such programmes, aimed at involving the future leaders and economic players in the country make an invaluable contribution to the overall long-term financial inclusion agenda and should be supported.
Clive Mphambela is a banker. He writes in his capacity as advocacy officer for the Bankers Association of Zimbabwe (BAZ). BAZ expressly invites other stakeholders to give their valuable comments and feedback related to this article to him on firstname.lastname@example.org or on numbers 04-744686, 0772 206 913