The key objective of FSDZ’s work in financial capabilities is to improve knowledge, skills, attitudes, and ultimately behavior, that will help Zambians make better financial decisions and empower them to actively choose and effectively use a range of financial services.
FinScope 2015 and other data shows that financial illiteracy is a significant barrier to financial inclusion in Zambia, with many people not having the knowledge, skills and confidence to be able to manage their finances well. In particular, low income earners in Zambia are typically not familiar with basic financial terminology, are not aware of the financial products and services that are available to them and are not confident to approach financial institutions.
To help to overcome the challenges of financial illiteracy in Zambia, the Government of Zambia’s Financial Sector Development Plan (FSDP) coordinated by Bank of Zambia (BOZ), developed and launched the National Strategy on Financial Education for Zambia in 2012. The Strategy outlines a vision, core themes and key outcomes required to improve financial capabilities. The Financial Education Coordination Unit (FECU), housed within the Bank of Zambia, was established to engage stakeholders around financial education and to coordinate implementation of the strategy.
The ultimate objective of this work is to support increased financial capabilities through improved knowledge, understanding, skills, attitudes and behavior, of low-income Zambians. To achieve this objective, we assess the market to determine and understand current financial capabilities and determine the best means by which to ensure uptake, appropriateness and delivery of financial education. FSDZ conducts research to better understand the financial capabilities of Zambians as well as the providers serving them, and to assess the availability and uptake of financial education materials in the market that currently exist, who is providing them, how they are distributed, to whom, and their effectiveness. We also work to identify partners who are willing and have capacity to deliver financial education to the target group, either through existing or new initiatives, and we identify and test appropriate delivery methods to reach various target groups.
One of the key tenants of any intervention by FSDZ is to facilitate a market-led response to an identified need in the market—in this case, stimulating the supply of appropriate financial education. FSDZ believes there is a need for basic financial education to be provided to low-income populations. To this end, FSDZ is working with the Ministry of Education to ensure financial education in the school curriculum from grades K to 12. This initiative will go far to increasing financial capabilities of Zambians. However, in addition to supporting the inclusion of financial education in the curriculum, FSDZ also facilitates financial education through suppliers and other public sector actors (beyond the Ministry of Education). To do this, FSDZ seeks to determine the financial capabilities of various market segments, and then develop materials and delivery methods to reach these segments. In order to ensure broad uptake, FSDZ develops appropriate materials in various mediums which include the opportunity for branding (i.e. space for company logos), with the view that both private and public sector actors will distribute and disseminate the materials on an ongoing, sustainable basis.