The President of the African Entrepreneurship School, Mr Joshua Mensah has called on the government to couple the digitisation of the financial sector with a vigorously planned financial literacy programme for the citizenry
Mr Mensah explained that when the citizenry are equipped with financial education in the areas of saving, investment, insurance, mortgaging among other financial tools, it would help to bring wealth to the citizenry while digitisation reaps the various taxes for government.
He was speaking at the maiden edition of the annual Financial Literacy and Education conference, which brought together about 100 business owners, organised by the Federation of Financial Educators and Organizations (FFEO) in Accra on the theme: “Reshaping the Future of Finance through Digitization.”
The Conference aimed at contributing to the vision of the National Strategy on Financial Education for Ghana for citizens to have the knowledge, understanding, skills and confidence to make prudent financial decisions for themselves, their families and their communities.
Mr Mensah said as government was on its way to achieving its financial inclusion agenda, it would be necessary to educate the masses on various ways of managing their income towards growing financially independent citizenry and build national prosperity.
Embrace Financial Planning
He urged the citizenry to embrace financial planning in all its smallest component – cash flow, investment, estate, insurance, children’s future, tax, and retirement planning, explaining that very few do take time to find out what comes in and what goes out of their hands each month.
Further, he said savings and investing were two separate activities, clarifying that one has to do with expenditure while the other has to do with financial instruments, noting “Investment planning deals with the kind of instrument an individual should invest in to get the best out of his wealth”.
Expounding on the retirement planning, Mr Mensah said to achieve a hassle-free retired life, there was the need to make prudent investment decision during your working life, thus putting your hard-earned money to work for you against the future.
Launch of Sika Tse, a Financial Education Tool
The President of AES launched a financial tool named ‘Sika Tse’ (Rich Person) to help train individuals, professionals, young people, both formal and informal actors as it assist them in answering questions on the use of their finances.
The tool is aimed at build their financial acumen as it tis characterised with all expenses in our daily lives. Among the benefits is that it can help in budgeting your revenue on key expenditure, helps to identify the things that consumes cash inflow, helps to increase financial knowledge of participants.
Mr Mensah urged individuals to enroll to partake in the programme in Executive Certificate in Financial Education leading to becoming a Certified Financial Educator. He said it would that would help enrich their financial knowledge, hence becoming ambassadors of financial literacy and education agenda.
Retirement and Government’s Plan
The Education and Sensitization Expert at the Corporate Affairs Unit of the National Pensions Regulatory Authority, Mrs Rosina Akrofi said pension contribution was necessary to prepare individuals in readiness for retirement.
She explained that the first-tier pension and the second-tier pension contributions were for the formal sector workers, while the third-tier contribution was for the informal sector. However, she explained that individuals in the informal could contribute through SSNIT informal.
Mrs Akrofi said the third tier comprises Voluntary Provident Fund and Personal or Group Pension Scheme for contributors, who were self-employed in the informal sector.
She said pension contribution amount in the informal sector was not constant like the formal sector and that a contributor could decide on any amount they could afford, noting a worker could join the pension contribution scheme if from age 15 years.
Prudent financial mechanisms to attract loans
Mr Robert Hertz Jackson, a Microfinance Expert from PH-Anova Solutions has called on Small Medium Enterprises (SMEs) to put in place good financial mechanisms to help make their businesses credible enough to attract Bank Loans.
He, however, cautioned that they should apply the Loans acquired diligently by investing in the businesses to bring about the growth of the business and to be able to repay on time.