The rate of people using financial services has jumped by 10 percentage points, from 69.15 percent in 2018 to 79.04 percent in 2020, according to the National Director of the Central Bank of West African States (BCEAO), Ahmadou Al Aminou Lo.Senegal is making a leap forward in its ambition to include more people in the financial system. Indeed, between 2018 and 2020, the country recorded a 10-percentage point increase in adults who were financially included.
“The overall rate of use of financial services has thus increased from 69.15 percent in 2018 to 79.04 percent in 2020,” said Ahmadou Al Aminou Lo on Thursday in Dakar, as he was chairing the workshop on prioritizing financial education actions.
According to the Organization for Economic Co-operation and Development (OECD), financial education is the process by which consumers or investors improve their knowledge of financial products, concepts and risks, acquire through information, teaching or objective advice, the skills and confidence necessary to, among other things, become more sensitive to financial risks and opportunities.
According to Mr. Lo, these achievements will be strengthened in the West African Economic and Monetary Union (UEMOA) once the issue of financial education has been addressed. Indeed, he stressed, more than 2/3 of the population of the common monetary zone live in rural areas and nearly 45percent of adults are illiterate and financially illiterate.
In view of these indicators, Mr. Lo pointed out, it seems essential to make the targeted populations understand the benefits of financial education (FE) so that they can ultimately ensure themselves and their protection against the risks involved in the use of financial services.
Thus, to materialize these priorities, BCEAO has undertaken to assist States in the formulation of their national financial education programs. “This exercise revealed that despite the actions undertaken by the States to strengthen the FE of the populations, challenges remain, particularly in the development of the financial skills of children and young people,” he said.
Ahmadou Al Aminou Lo also mentioned the challenges related to capacity building of the target groups of the regional financial inclusion strategy on good practices in responsible finance and the use of technology for the expansion of FE actions.
These challenges led, according to him, to the identification of three components constituting the main axes of the regional program of the FE. These include training for youth, building the financial literacy of target populations and building the skills of small and medium enterprises.
Financial education is closely linked to the population’s enthusiasm for financial products offered by banks and other financial institutions, the BCEAO National Director recalled. He thus assured that the process of national programs favored a participatory approach to establish the state of play of financial education in the WAEMU zone.
He also informed of the forthcoming adoption of the National Strategy for Financial Education and Inclusion, “which will shortly be submitted to the Council of Ministers.”
“The FE is one of the three pillars of customer protection alongside financial inclusion and regulation of the sector,” said Habib Ndao, the Executive Secretary of the Observatory of the Quality of Financial Services (OQSF).
For him, the FE appears to be an essential lever that should enable the population to develop a taste for the formalization of economic and financial activities, to have better access to financial products and services, but also to seize opportunities.
The objective of including the population, he added, cannot be conceived without improving their knowledge of finance and income management.
The development of the national FE program should help children and young people to make responsible decisions, seize investment opportunities, transform their knowledge into capital and contribute to the emergence of a knowledge-based economy.