Why Nigeria Needs To Deepen Its Financial Literacy Level -Toyin F. Sanni

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Sunday, September 15, 2019 /  08.00AM /  Bukola Akinyele for Proshare WebTV / Header Image Credit: Guardian Nigeria

 

Keynote speaker at the recent Capital Market Conference organized by the Securities and Exchange Commission (SEC) in collaboration with the University of Lagos, Mrs Toyin Sanni made a strong case for Nigeria to deepen its financial literacy level. 

Mrs Sanni an investment banker and Group CEO of Emerging Africa Capital Group said that the lack of financial literacy in the country, was responsible for the low level of money management skills in families and homes, as it concerns business and retirement. 

According to her, research studies on financial literacy revealed that most individuals including entrepreneurs do not understand the concept of investments, while some consumers don't seek out financial information before taking decisions. 

She noted that financial literacy enables people to understand what is needed to achieve a decent lifestyle and work-life balance, while ensuring their investments are sustainable and conducted in an ethical manner. 

Sanni emphasised the need for  increased awareness in financial literacy in the country, which will inform  Nigerians on issues of investments, risks and setting financial goals. 

Citing a 2015 Nigerian financial survey, Sanni highlighted the following;

  • Financial illiteracy; 31.1% in urban areas 68.5% in rural areas
  • Financial illiteracy among men; 48.5% of men in urban areas 50.3% of men in rural areas
  • Levels of education are low across the country 50.7% of the adult population has either know formal education qualifications or has only completed sub primary education.
  • The youth that drop out of school or that never enrolled in schools,  did not benefit from basic financial education interventions in  the school curriculum.

Speaking further she identified the following as the effects of Low Level of Financial literacy in the country;

  • Inhibition of productivity in the economy and  the society at large.
  • The inability to read or write creates a  disadvantaged generation, that cannot comprehend basic financial skills.
  • It increases the level at which individuals will experience financial risks
  • Lack of financial literacy leads individuals to avoidable financial frauds or scams.

The financial literacy advocate in Nigeria called for the leveraging of  Digital Finance,  through mobile phones  and personal computers to develop a reliable digital payment system. 

Sanni also stressed the need for all stakeholders to work assiduously to achieve the 80% financial inclusion target by 2020. 

Financial inclusion she noted was vital for Nigeria as it is a key to uplifting millions from poverty. 

Digital finance according to her  encompasses all products, services, technology, and infrastructure that enable individuals to deepen financial activities like savings and accessing credit. 

She called for collaboration between policy makers and the academia to enhance finance literacy and inclusion in the country. 

Innovations like mobile money are examples she cited of how East Africa has achieved scale in financial inclusion. 

She tasked Nigeria to deepen mobile money penetration, so as to enhance the financial inclusion level improve across the country. 

Serving as the Chairman of the SEC Financial Literacy Committee, Mrs Sanni  believed leveraging technology driven platforms, continuous advocacy for financial education and financial inclusion will result in efficient personal finance and an increment in democratization of wealth in Africa.

 

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