Accra, Ghana — "Promoting financial capability is about raising awareness, promoting knowledge, building trust, and changing behavior", says Dr. Kwabena Duffuor, Honourable Minister of Finance and Economic Planning of Ghana, who is hosting the event together with the Partnership for Making Finance Work for Africa (MFW4A). "And it is not limited to educating consumers and enabling them to take informed decisions on saving, loan and investment products. Additionally, management and staff of financial institutions need to be trained to become more responsive to the needs of their clients, and supervisors need the capacity to protect the consumers against fraud and other bad business practices."
The Partnership for Making Finance Work for Africa (MFW4A) supports the efforts of African countries to accelerate economic growth and reduce poverty by facilitating financial sector development. The Partnership's work is driven by the recognition that sound and inclusive financial sectors are strategic drivers of private sector development, employment generation, and equitable growth in Africa. The first MFW4A Partnership Forum took place in Ghana in June 2008 and gathered more than 350 key stakeholders from the public and the private sector. At the time, participants identified nine top priorities that policy makers, private sector actors and donors should address collectively and individually to make finance work for Africa. "Financial Capability" emerged as one of them. This provides the rationale for the upcoming conference "Promoting Financial Capability and Consumer Protection - A Step forward towards Financial Inclusion in Africa".
Low-income households in Africa often have limited access to demand-oriented and affordable financial services such as savings, loans, and insurance, which means that they have to revert to more expensive and less secure traditional alternatives of saving and borrowing and remain vulnerable to adverse shocks. Research has shown that in order to strengthen financial inclusion in Africa, there is a need to promote financial capability, i.e. to empower people to be capable of managing their financial assets and liabilities and to better understand their rights and responsibilities vis-à-vis financial institutions. However, strengthening the financial capability of the population is not sufficient since governments also have a role to play in protecting consumers by ensuring that financial institutions apply recognized standards and suitable codes of conducts. In order to create sustainable 'win-win situations' in the long-run, it is believed that financial capability measures need to go hand in hand with responsible, transparent and reliable services provided by financial institutions.
German Development Cooperation, the World Bank, DFID and USAID - the 4 main sponsors of the event - see financial capability and consumer protection as critical to their financial sector agenda and are increasing their support in this area, including outreach and knowledge sharing events such as this conference.
At the Conference, the perspectives of policy makers, regulators, consumer protection agencies, financial institutions, and clients will be discussed by practitioners from Africa, Asia, the United States and Europe. In moderated regional and national working groups, participants will have the chance to develop ideas and proposals as to what they think should be done in their country or region to improve financial capability. A panel on social marketing will show films and discuss which marketing channels can best be used to address the different target groups of financial capability campaigns. Also, the DFID-funded Financial Education Fund, a challenge fund supporting innovative projects in Africa that improve financial capability, will launch its second round at the Conference.
Financial Capability and Consumer Protection in Ghana
The Government of Ghana, together with the Ghana Microfinance Institutions Network (GHAMFIN), will hold - as a prelude to the above mentioned Africa-wide conference - a one-day Pre-Conference on "Promoting Financial Capability and Consumer Protection in Ghana" on 7 September 2009.
"Financial capability is very high on the political agenda of the Government of Ghana", says Seth Terkper, Honourable Deputy Minister of Finance and Economic Development. He adds that "Ghana is one of the first countries in Africa that has developed and started to implement a National Strategy for Financial Literacy and Consumer Protection in the Microfinance Sector". Over the past 2 years, Financial Literacy Road Shows have been carried out in all 10 regions of Ghana, easy-to-understand educational materials has been developed and distributed, high school quizzes have been organized, and radio programs on saving and responsible borrowing as well as TV sitcoms on insurance have been aired. All activities culminate in the Ghana Financial Literacy Week, which will take place from 28 September to 03 October 2009.
Against this background, over 150 Ghanaian and international financial sector champions from the public sector and the financial sector as well as representatives from academia, consumer protection agencies, non-governmental organizations and development partners will discuss and evaluate whether "Ghana Is on Track and Sets the Right Priorities in Financial Capability and Consumer Protection". Additionally, innovative topics such as "Integrating Financial Capability into High Schools" and "Promoting Financial Capability through Mass Media" will be addressed.
Both events, the Making Finance Work for Africa Conference and the Ghana Pre-Conference will challenge participating Government officials, civil society, media representatives, development partners and the private sector to engage in strengthening and empowering consumers in the financial sector and thus increase their access to save and sound financial services.
Contacts
Nunes-Correia, Yolanda
