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Financial literacy should be inculcated into our educational system -ISSER

botchway December 5, 2018

 

By Maxwell Obiri-Yeboah           .

Dr. Charles Godfred Ackah, a Senior Research Fellow at the Institute for Statistical, Social and Economic Research (ISSER), is advocating that the government inculcates financial education into the country’s educational system.

This, he said, if adhered to and properly implemented, would enlighten the citizenry to understand the financial sector and know the dangers some of these so-called financial institutions pose as they canvas for patronage from all corners of the streets.

Dr Ackah revealed this at a forum organised on Monday at the institute’s premises to analyse the 2019 budget, read on November 15, 2018.

The comments come as a result of the financial malfeasance issues rocking the country of late.

It would be recalled that about three years ago, a Sunyani-based finance company, DKM Microfinance Limited, used the deposits of its customers for excessive capital expenditure despite its low paid up capital of GH¢1 million, making it difficult to meet the depositors’ withdrawals upon maturity.

Less than six months ago, Menzgold Ghana Limited, a Ghanaian-owned gold dealership and other electronic transaction firm such as bitcoin, have now scooped millions of cedis with thousands of Ghanaians affected.

Dr. Ackah was, therefore, of the view that if the average worker is educated, it would help eradicate these problems from reccurring, as customers would be alert as they appear in different forms on the market.

He stated that the people of the Ghana should have knowledge about the capital market, how they are and their role in the society, with well explained functions for the average worker’s comprehension.

Touching specifically on insurance, the Researcher indicated that the insurance industry’s limits under the 1992 Constitution should be made known, so that people would know the value of insurance and understand its functions in nation building.

Dr. Ackah said that an observation made, based on previous research by ISSER, indicated that many people do not know the need for insurance, what they can insure, as well as credible institutions they can do these transactions with, and how to get claims when the need arises.

“Many Ghanaians do not have insurance, because they do not see the value of it. Apart from the compulsory insurance on cars, people hardly insure their properties and other valuable items,” he said.

Dr. Ackah continued that people do not know the difference between savings, current accounts and investments. “They also do not know when and how to take legal action against the banks in cases where there is a breach.”

He was emphatic that it does not matter one’s educational level in the country, because current statistics have proven that financial literacy is not synonymous with the education we have in the country.

“One can have a Master’s Degree, or even a PhD, and still be financially illiterate, or do not have any knowledge about the financial sector. I will not be surprised if I see any of my fellow-learned colleagues being mentioned in these ponzy schemes recently,” he underscored.

Dr. Ackah said people were losing money to financial institutions because they don’t have a clear understanding of the investment they make.

 

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