Poor financial literacy hampers Philippine growth

MANILA, Philippines - Despite the country’s recent economic gains, Sen. Sonny Angara lamented the poor ranking of the Philippines in a recent financial literacy index, which he said may hamper the government’s efforts to pursue inclusive growth. 

In the 2015 MasterCard Financial Literacy Index, the Philippines ranked second-worst among ASEAN countries, ahead only of Indonesia.

 “Glowing reviews and optimistic projections have been heaped on the Philippine economy, particularly its financial system. Opportunities abound on account of these developments but many Filipinos do not even have a basic grasp of economic and financial concepts,” Angara said.

ADB study: Philippines has no financial literacy program

A study by the Asian Development Bank (ADB)revealed that the Philippines does not have a national strategy for financial education and literacy.

“Such illiteracy hides recent economic gains from the minds of many people as it hinders them from participating meaningfully in the country’s notable ascent and economic growth,” Angara said.

Angara has filed a bill that seeks to declare the second week of November as Economic and Financial Literacy Week in a bid to develop national consciousness on economic and financial literacy.

Under Senate Bill 2779, the National Economic and Development Authority (NEDA) will serve as the lead agency and will be tasked to plan, initiate, execute and encourage knowledge-expanding activities on economic and financial literacy, which may be adopted by local government units, government-owned and controlled corporations and educational institutions.

NEDA will lead the participation and cooperation of relevant government agencies and instrumentalities such as the Bangko Sentral ng Pilipinas, Department of Finance, Department of Education (DepEd), Commission on Higher Education (CHED), National Youth Commission (NYC) and the Department of the Interior and Local Government (DILG).

All public and private elementary and secondary schools under the DepEd, all state and private colleges and universities under CHED, the Technical Education and Skills Development Authority (TESDA) and the NYC will be mandated to conduct consciousness-raising and knowledge-expanding activities. These include setting up literature corners, organizing fora and trainings, and conducting basic economic and financial management classes to improve the economic and financial literacy of students and the youth.

“We must recognize the growth potential of our country through financially literate citizens who can make sound financial decisions, mobilize savings, and contribute ideas on improving economic and financial policies and programs,” Angara said.

 Angara is one of the authors of Republic Act 10679, which aims to promote entrepreneurship and financial education among Filipino youth.

Financial education an integral part of learning

The DepEd is encouraged, under the bill, to assess and revise the high school economics curriculum to make it more age-appropriate, and ensure that economic and financial education becomes an integral part of formal learning.

The Philippine Information Agency and the Presidential Communications Development and Strategic Planning Office are mandated to allot airtime for programs, and to produce and disseminate printed and online materials for economic and financial literacy awareness enhancement.

As for private sector participation, the NEDA, in coordination with the Philippine Economic Society and in partnership with other academic and professional institutions, shall plan, initiate and encourage activities which may be adopted by the private sector and civil society.