RBM takes financial literacy to farmers, MSMEs
Director for Financial Sector Regulation Department at Reserve Bank of Malawi (RBM) Sopani Gondwe has said this year’s financial literacy campaign targets sectors of agriculture and Micro, Small and Medium Enterprises (MSMEs) which seeks to equip them with personal finance and business management skills.
Speaking on Wednesday, Gondwe said RBM had engaged SME Support Centre to develop and implement financial literacy programmes for MSMEs which intends to raise awareness on financial products and services across the country.
“We are trying to expand awareness on sectors of farmers and Micro, Small and Medium Enterprises as they are the backbone of the economy for growth and job creation,” He said.
Gondwe further highlighted that they try to increase the awareness because capacitating MSMEs to have knowledge or education and understand financial literacy, is a key ingredient in empowering them to improve the living standards and life styles.
Generally, Malawi have low levels of financial literacy which is of concern because the lower the awareness, the lower the literacy levels, also basically means the uplifting of living standards will be lower. The 2018 data indicated that only 29 percent of adults had bank accounts which drastically dropped in 2022 with five percent.
“Therefore usage and access to financial services will be lower again. The higher you increase, promote access to wider population which is good because it improves the living standards. Financial literacy in short improves the people’s well-being.”
RBM Director for Financial Sector Regulation Department admitted that a larger number of the populations are unable to access credits from the formal financial institutions, which is a supporting tool to improve the living standards and there is need to move the numbers up.
RBM data indicated from January to December 2023 credit levels remained unmoved at K1.2 Trillion, according to Sopani Gondwe, it entails that Malawi still have a long way to go to support the large populations access credit, which is also part of financial literacy programmes this year.
In her comment, Linda Onyango Chief Executive Officer (CEO) for SME Support Centre which is based in Nairobi, Kenya emphasized that financial literacy is the important part of economic development for any country, hence the need to take it seriously.
She also concurred that currently only 24 percent from 54 percent of adult population in Malawi use formal financial institutions which include have bank accounts for cash flow and it is relatively low, than expected in this era.
“There about 11 million adults in Malawi, and only shows that 0.9 percent are on general insurance.” expressed concern Onyango.
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