The President of the Liberia Bankers Association (LBA), Olalekan Balogun, has urgently called for heightened efforts to improve financial literacy in Liberia, particularly in relation to small and medium-sized enterprises (SMEs).
During the launch of the Financial Education (Fin-Ed) program and the Pan-African Resettlement Payment System (PAPSS), he emphasized that the lack of financial knowledge is a major barrier to accessing credit for businesses in the country.
Speaking at the event, Balogun pointed out that many SMEs in Liberia are facing significant challenges when it comes to borrowing and managing financial resources.
He stressed that the financial literacy gap is preventing both businesses and individuals from fully participating in the economy. "The issue of financial literacy is something we've been struggling with for a long time. It's especially critical when it comes to financial inclusion and access to finance," he said. "I want to implore that more emphasis should be placed on improving access to finance because that is a critical need for our businesses."
Balogun is also the CEO and Managing Director of Bloom Bank Liberia.
The LBA President's remarks were a response to growing complaints from the SME sector, which has long expressed frustration over the difficulty of securing loans from banks.
According to Balogun, while banks are eager to lend, the lack of proper understanding of financial products and borrowing mechanisms among potential borrowers is a major obstacle. "We hear complaints from the SME sector that banks are not lending, but that's not the case. Banks want to lend, but there is a significant gap in financial literacy, particularly when it comes to understanding how to borrow responsibly and repay loans," Balogun explained.
He called on the Central Bank of Liberia (CBL) and other stakeholders to place more emphasis on educating the public about financial management, especially in relation to borrowing, saving, and investing.
He highlighted that the need for financial literacy is not just a concern for businesses, but also for individuals who may not fully understand the available financial tools and how to use them to their advantage.
"This is a critical issue that affects the broader economy," Balogun said. "Improving financial literacy is essential for ensuring that businesses, particularly SMEs, can access the capital they need to grow and thrive."
Balogun's comments come at a time when Liberia is exploring new digital payment systems to enhance financial transactions. One such initiative, the Pan-African Payment System (PAPS), was formally launched during the same event.
The system is expected to simplify cross-border transactions and reduce reliance on third-party currencies, particularly the U.S. dollar, which has long posed challenges for businesses conducting international trade.
Balogun expressed enthusiasm for the platform, noting that it would provide a much-needed solution for businesses, particularly those in Liberia. "This system will make transactions faster, cheaper, and more efficient, enabling businesses to trade across Africa without the usual barriers," he said.
However, Balogun cautioned that while these technological advancements will benefit businesses, they must be complemented by improved financial literacy.
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"The introduction of systems like PAPS is a great step forward, but if businesses do not understand how to use them effectively, the benefits will be limited," he stated.
He urged both the private and public sectors to work together to ensure that financial education is a key part of any economic reform efforts.
In closing, Balogun reiterated his commitment to supporting financial literacy initiatives, emphasizing that the LBA is ready to collaborate with the Central Bank and other partners to address these critical issues.
"The financial literacy gap is one of the most significant barriers to economic growth in Liberia," he said. "With the right education, businesses will be better equipped to navigate the financial landscape, access funding, and ultimately contribute to the country's development."
