Financial literacy vital to preventing scam success – BSP officer
Greater financial knowledge can prevent people from falling for
financial cons such as Ponzi schemes and pyramid scams, a ranking
officer of the Bangko Sentral ng Pilipinas said Tuesday.
"A public that is not well-informed is more vulnerable to all kind of
scams," BSP's deputy governor Nestor Espenilla said in a press briefing
on Tuesday.
This is where financial literacy and consumer protection come into
picture, he added.
"Whenever we talk about financial inclusion, [we] always come back to
the issue of a more informed, educated public to be able to properly
consume financial services that will be [to] their advantage," he said.
Financial inclusion is the availability of banking services to
low-income sectors.
Recently, authorities discovered an alleged investment scam by Aman
Futures Group that may have duped as many as 15,000 people, mostly from
Visayas and Mindanao, of as much as P12 billion in total. The company,
which is purportedly engaged in trading, is accused of luring investors
by offering between 20 to 80 percent interest within eight to 20 days.
Progress on financial literacy
With a barely passing mark of 52.6 on Citibank's financial quotient
survey, Filipinos' understanding of money matters is "not that
impressive," Espenilla said, though they are "making progress."
To promote financial literacy, the BSP provides lectures and seminars
attended by students, young adults, and overseas Filipinos and their
families, among others.
"BSP has embraced as part of its commitment financial inclusion,
promoting financial and monetary stability… We have 22 areas or focal
points for training and financial learning in the countryside," he said.
"BSP also assumed the leadership role in advocating this [financial
literacy and inclusion] and promoting this idea to other central banks
in the world," he added.
Espenilla added that financial literacy promotion should involve the
whole society; it "is not a pact between the central bank and the
[banking] industry alone."
Financial literacy on banking services
In the same press briefing, Citibank's Southeast Asia head Michael Zink
concurred with Espenilla that availing of financial services without
proper education may bring negative consequences to consumers.
"Financial literacy is not just knowing financial services but also to
better use them… Financial products without education can provide
unintended increase in vulnerability," he added.
"Through financial education, [we] not just [hope clients] to become
better client but to be in better places. It will help them to plan not
just the short term," he said.
According to Zink, about 1.5 billion people in Southeast Asia has no
access to formal financial services.
On Thursday and Friday, about 300 delegates are set to convene for the
9th annual Citi-FT Financial Education Summit, which will be attended by
non-profit organizations, financial institutions, government regulators,
multilateral institutions, microfinance institutions, educational
institutions and private businesses. — BM, GMA News
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