Filipinos Need Financial Literacy

Back in 2021, then Bangko Sentral ng Pilipinas (BSP) Governor Benjamin Diokno stressed the need to improve the financial literacy of Filipinos especially since the number of digital transactions has increased. Financial literacy, he also mentioned, is advantageous to both the economy and individuals.

“A financially resilient citizen can be more productive, and contribute more meaningfully to nation-building,” said former BSP Governor Diokno.

In a 2015 World Bank (WB) survey regarding the financial literacy of adults, in the Philippines; financial literacy was the lowest in the region and lagged behind other countries. The Philippines’ rate was at 25% while Malaysia was at 36%, Myanmar at 52%, and Singapore at 59%.

An estimated 18% of respondents mentioned that they placed savings in banks and this number went up to 21% back in 2019.

Financial literacy is not part of any required curriculum in either grade school, high school, or college. With Filipinos unable to access a lot of social security mechanisms in the Philippines, financial literacy is a vital life skill.

Since the pandemic, a survey back in 2021 reported that Filipinos started saving more to prepare for possible expenses brought about by COVID-19.

One can remember that at the beginning of the pandemic, Gcash numbers and bank accounts kept going around, with people asking for financial assistance due to the mountains of debt brought about by hospital bills.

I have personally heard of hospital bills reaching millions of pesos and families unprepared to shell out this amount right off the bat.

With underdeveloped social security mechanisms as compared to more developed countries, this meant life or death in the pandemic.

This pandemic has underscored the importance of having an emergency fund, savings, and insurance plans in case of an emergency.

With this, the government should prioritize financial literacy and implement programs and initiatives to better educate Filipinos.

Source: Philippine News Agency, Business World,